Are you eligible for a tax break on your company vehicle?

Kevin Rudd has called small businesses the ‘backbone of the Australian economy' and in light of the almighty "GFC" and global recession, announced in 2009 that the government would help them stay afloat with a ‘boost' to the already established Small Business Tax Break. Small businesses will now be able to claim a bonus tax deduction of 50 per cent off the cost of eligible assets over $1000 in the 2009/2010 fiscal year.

Vehicle-wise, this means that if you own a small business, purchased a new vehicle before December 13 2009 and it was delivered before December 31 2010, you'll most likely be eligible to hit the government up for a tax cut of up to 50 per cent of the cost of the car.

This is good news for business car finance. Business vehicles can be an important but expensive company asset, and this tax break is a great opportunity for small businesses to nab a potentially sizeable tax return. So remember to claim! As tax time rolls around, take advantage of the benefits offered to small businesses. Are you eligible?

Eligibility Checklist:

1. Must be classified as a 'small business', which means have an annual turnover of $2 million or less.


2. The asset, in this case the vehicle, must have cost over $1000, and have been purchased  between  13 December 2008 and 31 December 2009; and be in use or delivered by 31 December 2010.


3. The car must have been purchased for the principle purpose of helping business operations.

Remember:

1. The 50 per cent tax rebate is applicable for vehicles priced up to the threshold of $57,180.


2. It's always wise to double check your eligibility and claim figures with your accountant, to make sure you get the most out of this deal!

Small businesses have taken a hit over the past year. If car finance cut into your small business expenses last year, make sure this rebate opportunity features in your tax return this year!

For more information, see the government press release.