With tax time here again, the new changes to asset depreciation tax means good news to your bottom line. Before you rush out to buy the latest and greatest tools here is what you need to know:

What is changing?

New instant asset write-off threshold changes; small businesses can claim an immediate deduction for assets they start to use provided each depreciable asset costs less than $20,000. This will temporarily replace the previous instant asset write-off threshold of $1,000. This means that a small business can claim an immediate deduction for the cost of each and every depreciating asset that they purchase for less than $20,000.

When do they take affect?

Asset tax changes started on the 12 May 2015 7.30pm (AEST) and will last until 30 June 2017.

What is included?

All depreciating assets whether new and second hand are eligible for the simplified depreciation rules.

What is not included?

Assets excluded from these depreciation rules include horticultural plants and in-house software allocated to a software development pool. More often than not, a specific set of depreciation rules apply to these assets and this remains unchanged.

Who can claim?

Small business owners can immediately claim the cost of assets less than $20,000 as long as you meet the government definition of a small business entity, which is one with a turnover less than $2 million annually.

Who do I turn to for help:

As always, when dealing with your small business cash flow speak to your accountant about whether you can afford to invest in any new assets and whether they will be a benefit to your business in the short and long term.

The ATO (Australian Tax Office) offers a plethora of resources about current and upcoming tax issues. They aim to provide leading tax and superannuation administration, and are known for their contemporary service, expertise and integrity.

The Australian Government also offers support through business.gov.au. They support a wide range of initiatives and provide detailed information on current government policy, programs and projects in relation to small business. Here you will find checklists, grant application processes, ABN look up services, government association lists and an event finder.

Want to know what else is changing?