On Friday, 5 September 2014 the Minerals Resource Rent Tax Repeal and Other Measures Bill 2014 (“the Bill”) received Royal Assent.
The Bill covers the following measures:
Abolition of the company loss carry-back from 1 July 2013
The loss carry-back has been repealed from 1 July 2013, limiting the concession to a single tax year — 2012/13. It provided tax relief to companies, by allowing them to carry-back tax losses to receive a refund against previously paid tax.
Reduction of the instant asset write-off from 1 January 2014
For the 2012–13 income year, small businesses had been able to write-off depreciating assets costing less than $6,500. They could also depreciate most other assets in the general small business pool at a rate of 15% in the first year and 30% thereafter.
From 1 January2014, the threshold will change and only assets costing less than $1,000 will be eligible for immediate write-off. Assets costing $1,000 or more will need to be depreciated in the general small business pool.
Assets costing less than $6,500, acquired and installed ready for use by the small business between 1 July 2013 and 31 December 2013, will still be eligible to be immediately written-off.
Abolition of accelerated depreciation for motor vehicles from 1 January 2014
Under previous legislation small businesses could claim up to $5,000 as an immediate deduction for motor vehicles costing $6,500 or more that were acquired from the 2012-13 income year onwards. The remaining value was depreciated in the general small business pool at a rate of 15% in the first year and then at 30% a year thereafter.
From 1 January 2014, there is no access to the $5,000 immediate deduction.
Motor vehicles acquired and available for use between 1 July 2013 and 31 December 2013 will still be eligible for an immediate initial deduction of up to $5,000.
Regards, Brett Price
Partner Price Williams Whyte Accounting & Business Advisors