AIBS National News

The Federal Budget contained a number of initiatives that will help small business. The most significant was the expansion of the Small Business and General Business Tax Break so that small businesses can claim a bonus 50 per cent tax deduction for eligible assets costing more than $1,000 acquired from 13 December 2008 until 31 December 2009, and installed ready for use by 31 December 2010.

This is up from 30 per cent announced earlier this year and extends the period of eligibility by six months. To benefit from this Tax Break a small business must have a turnover of less than $2.0 million a year. The expanded Tax Break will be available to small businesses with a turnover of less than $2 million.

All other businesses can continue to access the Tax Break at 30 per cent for eligible assets contracted for prior to 30 June 2009 and 10 per cent for eligible assets that they commit to investing in between 1 July 2009 and 31 December 2009. Small businesses only need to invest a minimum of $1,000 per asset in order to qualify for the Tax Break. Under enhancements to the Tax Break announced in March 2009, they can also amalgamate their expenditure on batches and sets of assets in order to meet this threshold.

The extended concession, which is still subject to its original legislation, applies to depreciating tangible assets subject to tax deductions under Division 40 of the Income Tax Assessment Act, that are over $1000 in value.

There is an opportunity to claim bundled assets under the concession. For example, buying tables, chairs and a sofa for a conference room, which cost more than $1000 in total, could be claimed."