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Philosophy: Maintain Current or Upgrade to New Equipment?

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Philosophy

Hi friends,

I cannot believe it’s May and we are already almost half way through the year!

This time of the year is generally fast paced for most businesses and purchasing new assets may not be on your mind.

There are many benefits that come with upgrading to new equipment, some of which include the following:

Repair Costs vs Repayment Costs:

If repairs are uncommon and your equipment is still fairly new then purchasing new equipment may not be necessary. However, if repairs costs are starting to increase and the asset is getting old, it may be time to look at upgrading.

The cost of repaying a loan will end up being far less than the costs that you will incur when paying for repairs.

Quality/Efficiency of the asset:

If your equipment assets are not as efficient as they use to be, it might be time to upgrade. This is an obvious point for many reasons, including safety in the workplace.

If equipment is faulty or causing issues it will end up impacting how efficient you are at getting work done and you may even lose contracts. This will have a huge impact on your business’s cash flow, especially if you are constantly having to find money to pay for repairs and labour.

Attraction in the market:

In a competitive market it’s vital that you have updated equipment for many reasons including; functionality, reliability, resale value and of course safety!

Tax Incentives:

If you own a small business with a turnover from $10 million to less than $50 million, you could be eligible to purchase business assets of $30,000 or less before 30 June 2020 and claim the whole amount as a tax deduction.*

That’s all from me for now. If you require any further assistance or would like to simply discuss an idea you may have in relation to growing your business contact your Ledge Finance Executive directly or call me on 0418 912 889 or email phil@ledge.com.au and we will be more than happy to assist.

 

*The Content herein is intended to provide only general information on the subject, current at the time of writing. Please refer to ato.gov.au and/or your tax advisor for more information and specific advice.

 

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