All small businesses will receive an immediate tax deduction for every asset they purchase costing less than $20,000. Currently, the threshold sits at $1,000.

This $20,000 limit applies to each individual item. Small businesses can apply this $20,000 rule to as many individual items as they like.

Increasing the depreciation threshold will mean value-added cash flow for small businesses. It will inspire businesses to bring forward investment in the assets they need to grow their business and service their customers.

The new threshold will also necessitate small businesses spending less time tracking assets across years for tax purposes. This removes red tape and allows business owners to focus on operating and growing their business.

Any assets over $20,000 can be added together (‘pooled’) and depreciated at the same rate. These assets are depreciated at 15 per cent in the first income year, and 30 per cent per year thereafter.

If the value of the pool is below $20,000 until the end of June 2017 it can be immediately deducted too.

This temporary jump in the threshold will support small businesses to invest in new assets which will help them grow and prosper into the future.