Investment Allowance for Business

Do you check all the boxes?

You may be eligible for the Australian Government's new Investment Allowance.

How does it Work?

The investment allowance will operate as a tax deduction on eligible depreciating assets.

The allowance can be claimed through the income tax return in which the first capital allowance is claimed for the asset.  The allowance will be paid at a rate of 10 per cent of the asset's cost.

Who is eligible?

The investment allowance will apply to new tangible assets, and new expenditure on existing tangible assets, used in carrying on a business, for which a deduction is available under the core provisions of Division 40 (Capital Allowances) in the Income Tax Assessment Act 1997.  Expenditure must occur between 13 December 2008 and 30 June, 2009 and have a minimum (taxable) value of $10,000.

Assets must also be installed ready for use by the end of 30 June 2010.

What is excluded?

Excluded assets include:

• Assets previously used or held for use';
• Land and trading stock 9as they are excluded from the definition of depreciating assets);
• Assets to which division 40 does not apply, including capital works(which can be deducted under Division 43); and
• Assets for which deductions can be obtained under other subdivisions.