The government has put their hands in their pockets (well tax payers' pockets) to provide businesses with tax breaks when purchasing depreciating assets within a specified period. While it applies to many items, it also includes the purchase of new cars. The bonus tax deduction amount differs according to the size of the business, with bigger bonuses for small business owners.
The peak body representing the Australian automotive industry, the Federal Chamber of Automotive Industries (FCAI) is supportive of the government's initiative. "The industry welcomes the timely, unhindered passage of this legislation," FCAI Chief Executive Andrew McKellar said.
Most businesses will be able to claim a bonus tax deduction of 30 per cent on the cost of a new vehicle acquired before 30 June 2009 - thereafter a 10 per cent bonus will be available until 31 December 2009.
Small businesses will be able to claim a bonus tax deduction of 50 per cent on the cost of new vehicles acquired before 31 December 2009.
"This measure offers a significant saving on the cost of a new vehicle and business owners are encouraged to act quickly to take full advantage of it," he said.
"The industry now has the opportunity to promote this valuable incentive with confidence," he said.
"This tax break provides a boost for business and we are hopeful that this incentive will help to encourage additional new vehicle sales in coming months," Mr McKellar said.
To find out if you qualify and how much you can potentially save, speak with your tax consultant