Private ruling: Income tax - instant asset write off
Date of advice: 20 January 2021
Published: March 2021
Ruling period: Year ended 30 June 2021
Date scheme commenced: 1 July 2020

Ruling: Q1: Will you be entitled to an immediate deduction for the costs incurred for a caravan, used 100% in your sole trader business activity, under the instant asset write-off provisions in Subdivision 328-D of the Income Tax Assessment Act 1997 ? | A1: Yes.Having taken into consideration your circumstances and the relevant facts, the Commissioner is satisfied that you meet the instant asset write-off eligibility and threshold criteria and can claim an immediate deduction for the costs incurred where the asset is first used for use during the relevant period.Further information on the 'Instant asset write off for eligible businesses' can be found by searching 'QC 61417' on ato.gov.au

Relevant facts and circumstances: You commenced your business activity of developing care plan for clients with complex needs in 2017 and have an aggregated income of less the $10 million. Your business has grown rapidly and have outgrown your home office space and you now need to expand your workspace. You have now taken on employees and will likely need additional staff in the future. You intend to purchase a caravan that will be used as additional business office space. The caravan will cost approximately $30,000 and will be used 100% for business on a daily basis. The caravan will not be used for private purposes. The caravan office space will be used for meetings, client reviews and clinical consultations.

Relevant legislative provisions: Income Tax Assessment Act 1997 - Subdivision 328-D | Income Tax Assessment Act 1997 - section 328-180. | Income Tax (Transitional Provisions) Act 1997 - section 328-181