How much is the tax deduction?

How much is the additional tax deduction available under the Temporary Investment Allowance?

The additional tax deductions available under the Federal Government Temporary Investment allowance are:

  • For small business - 50 per cent of the cost (excl. GST) of eligible new depreciating assets acquired under a contract, or started to be constructed, after 12.01am AEDT 13 December 2008 and before the end of December 2009, and installed ready for use by the end of December 2010, and,
  • For general business - 30 per cent of the cost (excl. GST) of eligible new depreciating assets acquired under a contract, or started to be constructed, after 12.01am AEDT 13 December 2008 and before the end of June 2009, and installed ready for use by the end of June 2010, and,
  • For general business - 10 per cent of the cost (excl. GST) of an eligible asset acquired under a contract, or started to be constructed, between 1 July 2009 and 31 December 2009, and installed ready for use by the end of December 2010.

These tax deductions are in addition to any other applicable tax deductions for the assets, and are claimable in the Financial Year in which the asset is installed and ready to use.

This means the total tax deduction for eligible assets is 150% or 130% or 110% of the total cost price (excl. GST), with 50% or 30% or 10% claimable up-front in the year in which the asset is installed ready for use, and the other 100% claimable as per normal over the effective life of the asset.

Please note: The Temporary Investment Allowance is no longer available for asset purchases made after 31 December 2009. This information is provided for reference purposes only.