You are buying equipment.
A new vehicle, machine or fit out is a real cost and a real tax decision. How and when you buy changes what you can claim, how it hits your cash flow, and what your tax bill looks like at year end. Here is how to get the timing and the structure right.
Not sure this is your moment? Start here
What's happening
- You are about to buy a vehicle, plant, machinery, tools or technology for the business.
- You want to know whether you can write it off immediately or have to depreciate it over years.
- You are weighing cash, a chattel mortgage, a lease or hire purchase to fund it.
- The timing of the purchase, before or after 30 June, could change this year's tax bill.
- You want the GST and the asset register handled correctly so the claim holds up.
What to think about
- 01
Check what you can write off now
Instant asset write-off thresholds and rules change from year to year and depend on your turnover, so the amount you can deduct immediately is not fixed. We confirm the current threshold and whether your purchase qualifies, rather than assuming last year's rules still apply.
- 02
Understand depreciation if it is not written off
Assets that sit above the write-off threshold are depreciated over their effective life, either through the general small business pool or item by item. This spreads the deduction across several years, so the tax benefit arrives gradually rather than all at once.
- 03
Get the timing right around 30 June
An asset generally needs to be installed and ready for use, not just ordered or paid for, before you can claim it. Buying late in June can bring a deduction forward a full year, but only if the timing genuinely lines up. We model both sides so the decision is deliberate.
- 04
Choose finance that fits your cash flow
A chattel mortgage, lease and hire purchase each treat GST, interest and depreciation differently. The right choice depends on your structure, GST registration and how you want the cost to land on your books. We compare the after tax cost, not just the advertised rate.
- 05
Mind the private use and car limits
Vehicles carry their own traps. Cars are subject to a depreciation cost limit, and any private use reduces the deductible portion and can trigger fringe benefits tax. A logbook and clear records protect the claim, so we set these up before the asset goes into service.
- 06
Keep the asset register and GST clean
Every asset needs to be recorded with its cost, date ready for use and depreciation method, and the GST credit claimed correctly in the right BAS. Good records here are what make the deduction stand up if the ATO ever asks.
How we help with the purchase
Tax planning and structuring
We model the timing and the after tax cost so you buy in the year and the structure that gives the best result.
ExploreAccounting and taxation
We claim the right write-off or depreciation, handle the GST, and keep your asset register correct and audit ready.
ExploreCFO services
For larger capital spend we build the cash flow and return forecast so you can see the impact before you commit.
ExploreQuestions we hear most often.
Have a question that is not here? Call 07 3399 2300 or book a consultation and we will answer it directly.
Can I claim the full cost of equipment in the year I buy it?
Sometimes. The instant asset write-off lets eligible small businesses deduct the full cost of qualifying assets up to a threshold in the year they are first used or installed ready for use. The threshold and eligibility rules change, so we confirm the current position before you rely on it. Assets above the threshold are depreciated over time instead.
Does it matter if I buy before or after 30 June?
It can matter a great deal. To claim a deduction this financial year the asset usually needs to be installed and ready for use by 30 June, not simply ordered or paid for. Buying a few days earlier can bring the deduction forward a full year, so the timing is worth planning deliberately.
Is a chattel mortgage or a lease better for tax?
It depends on your structure and how you account for GST. A chattel mortgage usually lets you claim the GST upfront and depreciate the asset, while a lease spreads deductible payments over the term. The best choice comes down to your cash flow and after tax cost, which we compare for your situation.
How does private use of a work vehicle affect my claim?
Only the business portion is deductible, so private use reduces what you can claim and can create a fringe benefits tax liability. Cars are also subject to a depreciation cost limit. Keeping a logbook and clear records is the simplest way to protect the claim.
Buy it once, and claim it right.
Before you sign the order, let us check the timing, the write-off, the finance and the GST so the purchase works for your tax position and your cash flow. Book a consultation and bring the quote.