Australasian Dentist Issue 92
CATEGORY 134 AUSTRALASIAN DENTIST FINANCE Stafford Hamilton Y ou may not be thinking about tax time just yet but preparing your tax deductions also means getting business purchases in early. After all, buying big- ticket items takes a lot of decision-making, plus reviewing budgets and expenses. Importantly, these purchases can represent a significant value-add as part of your practice’s overall strategy. Also, one thing we’re hearing about a lot is the supply of stock. Many providers locally relying on overseas manufacturers are still experiencing major or minor delays. Plus, a spike in sales could mean stock shortages. So, it’s vital to place your orders sooner rather than later to ensure the stock can be delivered and installed before 30 June – and be counted towards this current financial year. Why take up temporary full expensing? As part of the government’s response to the pandemic, it increased the instant asset write-off threshold for businesses from $30,000 to $150,000 for eligible assets. But as part of the government’s 2021/22 budget, it moved to a temporary full expensing rule where there is now no value threshold. This means any business earning up to $5 billion can write-off the full cost of any depreciable asset purchased from 6 October 2020 and first used or installed by 30 June 2022. Ultimately, the objective is to encourage business investment, which in turn, supports Australia’s economy and the road to recovery.This represents a good opportunity for owners to make the most of it: buy the equipment for your business and gain cash Taking full advantage of the stimulus extension By Stafford Hamilton, Chief Executive Officer and Co-founder of Credabl flow benefits from instant write-offs. A few general rules for the measure to confirm with your accountant: u For assets you start to hold, and first use (or have installed ready for use) for a taxable purpose from 6 October 2020 to 30 June 2022, the instant asset write-off threshold does not apply. You can immediately deduct the business portion of the asset under temporary full expensing u Goods can be new or second-hand u You can make numerous claims across many tax invoices or with multiple items on the one invoice u It’s not a one-time-only offer, just so long as each purchasemeets the criteria u If financed, the goods must be under a specific loan type, as not all facilities are appropriate u Assets that fall into this scheme include medical equipment and devices, dental chairs, IT equipment including servers, computer and phone hardware, along with scanners, copiers etc. Plus practice furniture, cabinetry, white goods and so on u All work vehicles to the extent they are used for business purposes Don’t I need to pay upfront? Given the potential generous tax savings up for grabs, many business owners are under the impression that you can only get the full expensing if you pay cash for the goods. However, you can actually borrow funds to acquire the eligible assets and still receive the benefit. Facilities such as a chattel mortgage meet the criteria and strategies that can be considered include: u Matching loan terms to the working life of the asset u No repayment and low repayment terms may also be available u Structuring payments to match cash flow including seasonal considerations u Acquiring an asset to be used for a specific work contract with options at the end of the contract to buy or hand the asset back u Having the flexibility to upgrade an asset when yours needs a change Remember, ifyouwant totakeadvantage of the temporary full expensing scheme, first check your business’s eligibility and the asset criteria. Always speak with your financial adviser or accountant for specific advice about how these measures apply to your personal circumstances and needs. u The team at Credabl is always here to support your plans with bespoke funding solutions. You can chat live on our website credabl.com.au or call one of our specialist lenders on 1300 27 33 22. This article is a guide only and does not constitute any recommendation on behalf of Credabl Pty Ltd (ACN 615 968 100) or any of its related bodies corporate (Credabl). The information in this article is general in nature and we have not considered your personal objectives or financial circumstances or needs when preparing it. Before acting on this information you should consider if it is suitable for your personal circumstances. Credabl is not offering financial, tax or legal advice. You should obtain independent financial, tax and legal advice as appropriate. Magnification & Illumination 1800 806 450 www.amalgadent.com.au Visit PeriOptix Booth #6 at ADX22 Sydney 17-19th March PeriOptix Footer #92.indd 1 03-Feb-22 3:17:08 PM
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