Tax time is finally upon us and for the money-savvy buyer, now is the time to start maximising your return using your industry purchases from the last year. While only some assets may be fully taxable, there are plenty of ways to partially claim expenses over several years as your equipment depreciates. Although the money spent on industry-specific tools is not deductible dollar-for-dollar, making tax deductions is a smart way to reduce the taxable turnover of your business or personal income.

To help you navigate the often-confusing territory of industry-relevant deductions, Pickles have put together some ATO approved tax deductible asset expenses.

Make sure to consult with an accountant or tax specialist to make sure you’re following all rules necessary to maximise your return!

Industrial deductions

Storage sheds can be a steel

If you have bought a shed in the last financial year, there are two ways to offset the expense. Firstly, you can put the asset on a depreciation plan which helps you claim the cost of the shed over its lifetime in small increments. Alternatively, if yours is considered a small business, you can claim the purchase of assets up to the value of $20k. You could potentially claim back your shed and all the assets inside up to that amount so long as the shed is placed on your business’ property!

Big assets come with big deductions

Did you know that small businesses in Australia can claim instant write-offs on a range of used plant and equipment asset purchases? Most Australians don’t, a recent American Express study showed that almost half of small business owners don’t know about the Federal Government’s instant write-off rules. If your business has less than a $10 million aggregated turnover, you could claim up to $150k in instant write-offs. Make sure to speak to your accountant about which purchases will be right for you, and read the ATO website for the latest information on thresholds.

Temporary full expensing

The Federal Government’s new temporary full expensing rule allows businesses to immediately deduct the portion of the cost of the eligible depreciating asset/s. Some of the tools you may be eligible to write off under temporary full expensing are: Read through the ATO rules and get in touch with your accountant to find out which of your industrial purchases from the last financial year are available for temporary full expensing.

Vehicle deductions

Travelling to work or working to travel

Do you travel on work-related journeys, conferences or meetings that aren’t hosted at your company's business address? The travel costs associated with these kinds of movements are partially tax deductible. These are just some of the car-related costs you may be able to claim on your tax return if your car is used for business purposes:
  • fuel and oil
  • repairs and servicing
  • interest on a motor vehicle loan
  • lease payments
  • insurance premiums
  • registration
  • depreciation
If you are on the hunt for your next work vehicle or truck, make sure to check out the full range of vehicle available at Pickles.

Office deductions

Don’t forget to claim back your WFH space

As a response to COVID-19 working conditions, many Australians have had to move the office to home. If you are WFH you are able to claim a range of home office supplies on your tax return. Bought a piece of Pickles IT equipment to complete your home office? You can claim the depreciation of these assets back on your tax return. OR for those of us who want more money for less work, you could try the shortcut method. You can calculate 80 cents per hour working at home to cover the depreciation of your home office assets like phone sets, laptops and furniture. To claim this deduction all you have to do is keep a log of hours worked from home and a record of your expenses.

For more information on what tools, assets and machinery you can claim on your tax return, visit the ATO website for the most up to date information.

*Disclaimer
*Please refer to the Australian Tax Office website to see whether your business qualifies for the instant asset write off. Please speak to your tax professional for advice tailored to your individual circumstances.

30 Jun