Recovery is a word we're hearing from all quarters. Meeting earlier this month, the decision of the Reserve Bank Board to leave the cash rate unchanged at 3.0% (the lowest it's been since the 70's) has prompted talk of stability, with the accompanying media statement describing Australia's economic conditions as better than expected and noting that measures of confidence are showing improvement.
The Government's decision to increase the small business tax break for investment in new assets from 30 per cent to 50 per cent has already had a noticeable effect on the plans of our small business customers. With small business asset investments of $1000 or more (a threshold that may be met by a group of similar items or a set of items) eligible for an additional tax break of 50 per cent, small businesses would be wise to consider bringing forward asset investment to fall in line with the 31st of December 2009 investment deadline.
General business can still take advantage of an additional 10 per cent tax break that continues to be available for new assets ordered before the end of the year and installed by the end of 2010. As has been noted previously, this applies to most new cars and demonstrator vehicles, as well as other new, depreciating business assets.
According to the most recent Roy Morgan Automotive Leading Indicators (July 2009), the number of Australians intending to buy a new car in the next four years (2,048,000) appears to be stabilising and is on a par with the long term average (2,052,000). Although this result is still down on the record numbers recorded in July 2008, 12-month intentions have also edged ahead of the long-term average.
These are positive changes for the automotive industry, but new car buyers should take note of the increasing confidence and be prepared for bargain basement prices to start winding up. With prices on the move and a considerable rationalisation of models predicted, it would be wise to consider the steps you can take to protect against resale value changes, as well as giving some thought to appropriate vehicle insurance and loan protection.
Find out more about equipment finance and car finance options to help you take advantage of the current tax breaks for small and general business. Try our repayments calculator, get a quick online car finance quote or secure a car finance pre-approval online - be prepared to buy smart.
For more information on finance or insurance, or assistance finding your preferred vehicle at the right price, call us on 1300 STRATTON (1300 787 288) or contact your Finance Consultant directly.