Tradie ute loans TRIPLE as Covid tax breaks are extended – so what can YOU claim under the instant asset write-off scheme?
- Commonwealth Bank business financing for utes surged by 187 per cent in year
- Australia’s biggest bank expecting surge in business lending during June 2021
- Instant asset write-off lets tradies claim ute cost over one year instead of eight
Tradesmen and women are borrowing big to buy a new ute and get generous tax breaks with financing numbers almost tripling in a year.
The Commonwealth Bank, Australia’s biggest lender, had a 187 per cent annual increase in business loans for light commercial vehicles during May 2021.
The category includes small trucks and utes.
Since October, business owners have been able to claim the cost of a new car against their income over one year instead of the usual eight.
Treasurer Josh Frydenberg in the May Budget extended that until June 2023 to turbocharge Australia’s post-Covid recovery.
Tradesmen and women are borrowing big to buy a new ute and get generous tax breaks with financing levels almost tripling in a year. Pictured are construction workers in Sydney
The instant asset write-off, officially known as ‘temporary full expensing’, was so popular the Commonwealth Bank’s executive general manager of business lending Clare Morgan expected a surge this month.
‘There’s a general expectation that we’ll see an uplift in both financing and registrations of business vehicles as we approach the end of financial year,’ she said.
‘We’ve seen the federal government’s instant asset write-off scheme support many of our customers in the past year.
The Commonwealth Bank, Australia’s biggest lender, has revealed a 187 per cent annual increase in business loans for light commercial vehicles during May 2021. Pictured is a Ford Ranger ute
What is the instant asset write-off?
The initial instant asset write-off, announced in the October 2020 Budget, allowed businesses to buy assets worth up to $150,000 and claim it on tax
The program, officially known as ‘temporary full expensing’ has been extended to June 2023
A business can claim an expense like car – worth up to $59,136- over one financial year rather than eight
‘We expect this demand to continue following the recent budget announcement, and we welcome the extension of the scheme until mid-2023 as a major boost for Australian businesses.’
Utes were Australia’s most popular cars in May, claiming not just the two top spots but also four of the top 10 places.
The Toyota Hilux was the best seller again, with 4,402 sales, a 24.8 increase compared with May 2020, Federal Chamber of Automotive Industries data showed.
Businesses can buy a ute worth up to $59,136, which has seen the self employed buy the more upmarket dual-cab workhorses that can also double as a weekend, family four-wheel drive.
The HiLux SR5 is the volume seller.
Ford Ranger sales soared by 59.7 per cent to 4,254, with the XLT dual cab a bigger seller than the tray back model.
Isuzu Ute D-Max sales tripled, rising by 202.8 per cent, to 3,058 to be Australia’s fifth most popular vehicle.
The Mitsubishi Triton saw its sales more than double, climbing by 167.5 per cent, to 2,317 to be Australia’s seventh most popular car.
Mazda BT-50 4×4 sales doubled, rising by 108.7 per cent to 1,225.
Commonwealth Bank asset financing figures showed also showed an 85 per cent increase in asset financing for vans and a 36 per cent increase for passenger cars and SUVs.
The Toyota RAV4 was Australia’s most popular SUV with 4,014 sold last month, an annual increase of 71.2 per cent.
Toyota LandCruiser sales climbed by 59.4 per cent to 3,399 even though a new model is being released in Australia later this year.
The instant asset write-off, officially known as ‘temporary full expensing’, has been so popular the Commonwealth Bank’s executive general manager of business lending Clare Morgan was expecting surge this month. Pictured is the Toyota HiLux, Australia’s most popular car in May