Tax breaks for Australian RV businesses
Good news for caravan manufacturers eligible for new wage subsidies and tax breaksIt’s the gift that keeps on giving...
As if the Instant Asset Write-off incentive introduced earlier this year as an economic response to COVID-19 wasn’t generous enough, the Federal Government is now extending eligibility, asset value and time frame of the scheme as part of the 2020 Federal Budget announced this week.
Under the new ‘Temporary full expensing’ measure, businesses with turnover up to $5 billion (that easily covers all RV-related businesses in Australia, even Jayco!) will be able to deduct the full cost of new, eligible, depreciable assets of any value in the year they are first used or installed ready for use.
What that means is any RV manufacturer with a business turnover of $15 million a year can buy a new CNC router or spray painting booth worth around $500,000, for example, and write it off completely in the year they bought it.
Full expensing also applies to eligible second-hand assets for small and medium sized businesses with aggregated turnover of less than $50 million.
For businesses with a turnover between $50 million and $500 million, second-hand assets under $150,000 can still be written off completely under the enhanced Instant Asset Write-off scheme.
The ‘Temporary full expensing’ measure is available from 7.30pm October 6, 2020 until June 30, 2022.
The cost of improvements made during this period to existing eligible depreciable assets can also be fully deducted, regardless of whether they are bought before or after the Budget 2020 announcement.
The Instant Asset Write-off incentive allowing eligible businesses to write off up to $150,000 in eligible asset purchases will also be extended to June 30, 2021, following an initial extension earlier this year.
Treasurer Josh Frydenberg said the ‘Temporary full expensing’ incentive is “the largest set of investment incentives any Australian Government has ever provided".
“It is a game changer, it will unlock investment, it will dramatically expand the productive capacity of the nation and create tens of thousands of jobs,” he said.
“A trucking company will be able to upgrade its fleet, a farmer will be able to purchase a new harvester and a food manufacturing business will be able to expand its production line.
“This will boost the order books of the nation and small businesses will buy, sell, deliver, install, and service these purchases.
“Every sector of our economy, every corner of our country, will benefit. This is how we will get Australians back to work.”
Among other potentially good news for RV manufacturers and dealers, the Federal Budget also allowed for $1.2 billion to help businesses employ 100,000 apprentices or trainees under a new apprenticeship support program.
Under the program, businesses can apply for a 50 per cent wage subsidy (worth up to $7000 per quarter) to take on new apprentices regardless of location, industry or business size.
Businesses can also receive a $200 per week subsidy if they hire an eligible employee aged 16 to 29 years, or $100 per week if they hire an eligible employee aged 30 to 35 years. Eligible employees include people who have been receiving welfare payments including JobSeeker for the past three months.
The so-called 'JobMaker Hiring Credit' program will cost $4 billion and run for 12 months from October 7.
Related:
Tags
Please see our Editorial Guidelines & Code of Ethics (including for more information about sponsored content and paid events). The information published on this website is of a general nature only and doesn’t consider your particular circumstances or needs.
