STIMULUS: 50% instant depreciation deduction
The federal government is introducing a scheme that allows businesses to deduct 50 per cent of the cost of an eligible asset straight away, as part of its efforts to combat the economic fallout of the coronavirus pandemic.
Businesses with aggregated turnover below $500m with new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997. This includes plant, equipment, and intangible assets, such as patents. The assets must have been acquired after the government announced the plan, and before the end of June next year.
This means that all big-ticket items in print including offset presses, high end digital print systems, high volume flatbed and roll to roll printers are far more attractive to buy. For instance, on a $2m press the new scheme means that $1m can go onto the books straight away, and if you have a $1m profit your tax bill of $300,000 would disappear.
The managing director of one supplier told Print21 that the new scheme was "gold" because of the significant and tangible financial benefits it delivers to printers. Equipment ordered will have to be installed by the end of next financial year.