If you are thinking about taking advantage of the 50 percent tax break for small businesses, it's important to check your business's eligibility and that the purchases qualify for the tax break before investing.
According to the Australian Taxation Office (ATO), if your small business has a turnover of less than $2million a year, you may be able to claim the extra 50 percent tax deduction on eligible depreciating assets.
The 50 percent tax break applies to eligible assets costing $1,000 or more that are purchased between December 13, 2008 and December 31, 2009 and are first used or installed ready for use by December 31, 2010.
Provided you meet all the eligibility criteria in the income year, your business can claim the deduction in the income tax return for the year the asset was first used or installed.
So if the asset was a computer bought and installed in September this year and it cost $1,000 or more, you may be able to claim the deduction in your 2009-10 tax return.
"Remember, the tax break is not a refund. It is a deduction and can only be used to reduce your assessable income at the end of the income year," an ATO spokesperson said.
"Before you buy any new business assets, talk to your tax agent or call the business tax break infoline on 1300 337 921."
For more information on exactly how the tax break works and what assets qualify visit www.ato.gov.au/businesstaxbreak.
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