Need Laptop buying Advice (on ABN, no BAS)

thegreatermamba on 29/06/2022 - 12:32

Hi there,

My partner just got ABN a few days back and has started using it for her practice.

She has not done any other thing yet like applying for BAS.

She needs a new laptop and I was thinking of buying a Surface Laptop Studio for her.

Can she claim it under her ABN yet or would there be any issues since only ABN is there and nothing else?

Also, would like to know what value comes back from the purchase, say for a $3000 laptop.

My assumption is

  • 10% GST would come back straightaway
  • Remaining 90% would be deducted from pre-tax salary, so if she is at 45% tax bracket, this will get further 40.5% off of full value, so total 50.5%

Is that correct?

Also, does it matter when the product is purchased during the financial year, as in is there an impact on calculations if we purchase it at the very end of the FY.

Would appreciate some quick help here.

Thanks in advance

General Discussion Computer Laptop

Comments

  • Typical16-bitEnjoyer on 29/06/2022 - 12:41
    +7

    If only there was a website or an entire industry created to answer all these questions…..

  • Jimothy Wongingtons on 29/06/2022 - 12:43

    uhhhhhhhhhhhhhhhhhhhhhhhh

  • Baysew on 29/06/2022 - 13:14
    +4

    Your assumptions are wrong.

    • thegreatermamba on 29/06/2022 - 13:30

      Would appreciate if you could correct. We are fairly new to Au tax system

      • AndyC1 on 29/06/2022 - 14:41
        +2

        Ask your accountant as you are new.

    • foxmulder on 29/06/2022 - 13:35
      +4

      The GST part will be true if she is GST registered. Thus $272 is credit against GST owed to govt from sales. If not registered for GST, there is no GST credit, but your deduction is based on full amount $3000.

  • freefall101 on 29/06/2022 - 13:31
    +5

    Absolutely none of this works how you're suggesting.

    edit: to add some reasoning, 1. See an accountant, 2. This is general advice based on what info you've given. I have no idea what your wife does for work, what her practice is, any of that. So see an accountant. If she's earning over $180k a year she should have one anyway.

    Having an ABN doesn't mean you can just start claiming things all over the place. Business expenses offset against business income, if her business doesn't make any income then they're just carried forward losses for future years (until the business does make a profit).

    Laptops are depreciated over multiple years, so you'll get a smaller amount back each year.

    You need to be registered for GST before you can claim any credits back on expenditures. But this means she also needs to be charging GST on any invoices she issues. So registering for GST is something she needs to think about. She should definitely talk to an accountant about this.

    • thegreatermamba on 29/06/2022 - 15:27

      Thanks. This is informative.

    • wei13 on 29/06/2022 - 21:21
      +2

      Adding to this (and not knowing OPs full situation):
      1) It is possible to deduct business loss against personal income, but rules for Non-commercial losses specifically prevents people from making 'losses' in their 'business', and then offsetting it against their other non-business income, unless they can pass one of the tests. In principle business losses are to offset business gains.
      2) Under Temporary Full Expensing rules, a business can deduct the full taxable use percentage immediately. If claiming a deduction against personal income, that is when it is depreciated - for a laptop - over 2 years.

  • jv on 29/06/2022 - 14:43
    +2

    Can she claim it under her ABN

    If it is used for her business and not for personal use, then yes.

    Why not purchase it after 1-July?

    If she just started her business, there would not be much benefit in the tax deduction this year….

    • thegreatermamba on 29/06/2022 - 15:26

      Microsoft seems to be running about 10% off EOFY sale. Was hoping to get one during that time

      • jv on 29/06/2022 - 15:28
        +2

        Don't forget the $100 AMEX cashback if you are eligible.

        Also, check the microsoft buyback program… Can be really worth it…

        I got $400 back for a Surface Pro 3 I had for a couple of years and only paid $300 for it… Also, got to keep the keyboard and powersupply….

  • Quantumcat on 30/06/2022 - 07:55
    +1

    You can't get the GST back unless your business is registered for GST.

    But don't register for GST until you are turning over enough money to force you to - unless you are losing money with the business you will have to charge more GST than you can claim back (as incomings are larger than outgoings).

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