Budget extends software depreciation

THOSE IN THE smash repair industry who are interested should know that the period in which computer software can be depreciated has been increased in the federal budget from two and a half to four years.

The jury is out on just what this means for those in the industry owning and using software that is presently being depreciated for tax purposes. Paint & Panel has sought accounting advice on this but unfortunately the fog has still to lift. Because of scant detail contained within the budget papers, it is not known what businesses will be affected. It
depends on the amount of software used in individual areas of the smash repair industry and for individual owners of software items, like assessors.

Initial accounting advice was that the move was short on detail and gives little hint of the ramifications for business in general. However, with the likes of quoting tablets a high-use item within the repair business together with the ridiculously long depreciation period now imposed – especially with software becoming redundant so quickly – it would be prudent to seek accounting advice.

The federal government says the move will save $1.3 billion by 2012 so supposedly there are some serious grab-back implications for all industries let alone the smash repair business. All we can do is advise you to ask your accountant for some clear guidelines and good luck.

If you have a specific enquiry about a software depreciation schedule please email us and we will try to answer that in the next edition of Paint & Panel.