$20,000 Asset Write-Off Warning
Are you a small business that wishes to claim the $20,000 asset write off? BEWARE, the ATO is watching you!
By now, all small business owners should be aware of the small business tax concession available to businesses with an annual turnover of $10 million or less (previously, $2 million) that allows them to deduct, in full, equipment purchases up to the value of $20,000 per item. While this concession will benefit a lot of small business owners, the ATO will be using data analytical tools to uncover those businesses out to exploit the system. The ATO will examine the following:-
- False income reporting to achieve a turnover under $10 million
- Separating one large purchase into multiple invoices
- Fraudulent invoicing
- Incorrect values on equipment (for example, buying an asset for $20,000 that would ordinarily be worth $3,000)
- Buying equipment for personal use and stating that it’s for business use
- Private parties requesting businesses pay for assets on their behalf in order to claim a tax deduction
- Quoting false ABNs; and
- Falsely applying for an ABN to qualify for small business deals on equipment.
Talk to us today to make sure your situation is compliant with the ATO's small business asset write off guidelines.