Be care­ful not to over-ex­tend

Southern Gazette (South Perth) - - STREET WATCH -

BEL­MONT Busi­ness En­ter­prise Cen­tre (BEC) chief ex­ec­u­tive Carol Han­lon said the con­tin­u­a­tion of the in­stant as­set write-off scheme was wel­comed by the small busi­ness com­mu­nity, but sug­gested own­ers should still ex­plore their op­tions thor­oughly.

The scheme has been ex­tended for another year, en­abling small busi­nesses to in­vest in equip­ment and re­sources.

“In these tough small busi­ness trad­ing times, our guid­ance to small busi­ness own­ers would be to not over-ex­tend pur­chas­ing com­mit­ments with­out full re­search on the need for this equip­ment, and pro­jected in­crease in sales the equip­ment, new fix­tures or a ve­hi­cle will bring to the busi­ness,” Ms Han­lon said.

“Also, be aware if the busi­ness is plan­ning to use its over­draft or loan to pur­chase this equip­ment, cal­cu­late the cost of the bor­rowed funds into the price of pur­chase and dis­cuss this in­tended pur­chase with their ac­coun­tant.”

The in­stant as­set write-off scheme, in­tro­duced in 2015, al­lows small busi­ness own­ers to claim im­me­di­ate de­duc­tions for cap­i­tal ex­penses up to $20,000.

It was a large jump from the pre­vi­ous in­stant-as­set write-off thresh­old of $1000.

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