After a reasonably tough five years, small businesses are starting to become a bit more confident. And they're beginning to act on that confidence and look to expand their asset base to cope with increasing demand.
The latest GDP figures show a 4.2 per cent increase in business services activity and a 2.2 per cent lift in wholesale trade, due to machinery and heavy equipment wholesaling.
But if you are considering spending on your business, it's worth checking in with your accountant. Even if you're just replacing older assets, here are things to consider.
First, have you done your numbers? If you're investing a big chunk of money into assets you need to be sure you can afford it. An increase in assets can mean increased insurance and labour cost, and other hidden extras. Do your sums.
Plan and make sure there is working capital available to support any changes in cash flow that may occur before the gains kick in. Consider how the purchase will affect tax and GST.