10 June 2019 · Buyer Tips & Advice

Understanding Instant Asset Write Off during EOFY | Phil Gilbert Kia

Understanding Instant Asset Write Off during EOFY

If you’re interested in buying a new Kia, you might want to consider taking advantage of the Federal Government’s Instant Asset Write Off this end of financial year. This initiative has been around since 2015 and many thought it might finish this year, but it’s been extended at least until June 30th 2020, and the threshold has been increased to $30,000. But what exactly is this Instant Asset Write Off and who can use it?

Small Business

If you own a small business with an annual turnover of less than $10 million, you can claim an immediate deduction up to the threshold limit for every asset you purchase, new or used, for your business. Assets include plant and equipment, tools, office equipment and vehicles, and they must be first used in the income year you’re claiming for.

Not Just for Business

If you buy a new Kia for your business and the full purchase price is under the $30,000 limit, but still want to use it for driving the family around and personal use, you can claim for the percentage of time the vehicle is used for business.

For instance, if your Kia is used to make deliveries for your business 70% of the time, and the other 30% of the time is non-business use, you can claim 70% of the price of your Kia as an Instant Asset Write Off in your 2019 tax return.

Purchases Greater Than the Threshold

If your new Kia costs more than the $30,000 threshold, such as a new Kia Sorento SUV or a Kia Stinger Sports Sedan, you can’t claim the Instant Asset Write Off. However, you can add the value of the business portion (the percentage of the time it’s used for business X the purchase price) to your small business pool. Your small business pool allows you to claim gradual deductions for depreciation every year on your tax return.

Consult your Accountant

The Instant Asset Write Off is assessed on the full purchase price of your new Kia, regardless of any trade-in allowance, so you can’t try to claim your vehicle cost less because you got, say, $4000 trade-in on your old vehicle. It also applies to the business as an entity, not to every partner of the business, so you can’t purchase assets under your own name and claim the Instant Asset Write Off It’s best to speak to your business accountant before you purchase any assets just to make sure they will be eligible.

Speak to a Kia Car Dealer Today

When you want to buy a Kia for your business, visit the professional team at Phil Gilbert Kia. Our new and used car dealerships offer full Kia deals that will save you money during tax time. Get in touch and call (02) 9735 8400 or visit our Kia showroom in Croydon.