Can you spot the difference between these 2 second-hand workmate Utes?
They are both the same age, I can tell you they have similar KM usage and look like they are in great condition to last a tradie a few years of hard work. Similar prices as well.
Except – this is the big difference, the Ute on the left is selling for $19,800.00 and the Ute on the right is selling for $20,300.00 and this is a massive difference when it comes to tax.
The Ute that’s under $20,000.00 can have the full amount of the purchase written off immediately. And if you have financed it, you can also claim the interest, so how you finance it is only important to make sure you are buying and not leasing.
The Ute that’s over $20,000.00 must be claimed through depreciation over a number of years, so the claim against tax occurs slowly, though you do get there in the end.
This is worth knowing, because if you are planning to buy a Ute or any equipment below $20,000.00 in value before the end of the year, the $20,000.00 tax clam threshold was extended in the last federal budget till 30th June 2019 (and here is hoping they will do it again).
The tax benefit works best for you if you have some financial planning in place. Maybe, by putting some more into your super, it will ease the pressure on the income tax for your sole trading ABN or company – a bit of relief you were needing.
If you were thinking that it was time to get a new Ute, or some other assets that your business needs and wants, call Your Business Angels 1300-982-559 to further discuss the benefits and impacts.
Thank You for reading this