Quick Answer: No, a project or purchase that is merely underway before 22 May 2025 but finishes after this date will generally not qualify for the Investment Boost. For expenditure to qualify, the asset must be acquired and ready for use by 21 May 2025.
The Investment Boost operates on a strict completion deadline, not just a commencement date. Simply starting work or placing orders before the deadline is insufficient for qualification.
What is the Investment Boost?
The Investment Boost is a temporary tax incentive designed to encourage New Zealand businesses to invest in productive assets. It allows eligible businesses to claim an immediate deduction for qualifying capital expenditure, providing valuable cashflow support during the investment period.
This boost is part of the government’s economic support measures, aimed at stimulating business investment and economic growth across New Zealand’s small to medium enterprise sector.
Related article: How to claim the Investment Boost?
Key dates and definitions you need to know
Critical Deadline
21 May 2025
All qualifying expenditure must relate to assets acquired and ready for use by this date. There are no exceptions or grace periods beyond this deadline.
What “Acquired” actually means?
According to IRD guidance, an asset is considered “acquired” when it is both paid for and ready for use in your business operations. This means the asset must be:
- Fully delivered to your business premises
- Installed and operational (where applicable)
- Available for productive use in your business
Simply signing contracts, paying deposits, or having work commence does not constitute acquisition under these rules.
Project “Completion” Definition
For larger projects or installations, completion occurs when the entire project is finished, tested, and operational. Progress payments made during construction do not qualify unless the specific components they relate to are completed and ready for use by the deadline.
Real-World scenarios
Scenario 1: Clear Qualification
Your business purchases new machinery in March 2025. The equipment is delivered, installed, and operational by April 2025. The full purchase price qualifies for the Investment Boost.
Scenario 2: Spans the Deadline (Your Situation)
You begin a major office renovation in January 2025, but the project isn’t completed until June 2025. Even though work commenced before the deadline, expenditure incurred after 21 May 2025 will not qualify for the boost. Only costs relating to work completed and operational by the deadline would potentially qualify.
Scenario 3: Delivery Delays
You order computer equipment in April 2025 to test your new digital tools, but due to supply chain issues, it arrives and is installed in July 2025. This expenditure would not qualify, as the assets weren’t acquired (delivered and ready for use) by the deadline.
What you can do now?
Review Your Project Timeline
Assess whether any components of your project can realistically be completed and operational by 21 May 2025. Focus your efforts on completing discrete, functional elements that can qualify.
Accelerate Where Possible
Consider whether you can fast-track certain aspects of your project or break it into phases, with the first phase completing before the deadline.
Document Everything
Maintain detailed records of when assets become operational and ready for use. This documentation will be crucial if IRD requires evidence of qualification.
Seek Professional Advice
The Investment Boost rules can be complex, particularly for larger projects. Consult with a qualified accountant or tax advisor who can review your specific circumstances and ensure you’re maximizing your entitlements within the rules.
Official Sources and Guidance
For the most current and detailed information, always refer to the official IRD guidance on the Investment Boost. The rules and qualifying criteria are outlined in detail on the IRD website, and this should be your primary reference for making investment decisions.
Legislative backing for these provisions can be found in the relevant Income Tax Act amendments, which provide the legal framework for these temporary measures.
Frequently Asked Questions
Is there any grace period beyond 21 May 2025? No, the deadline is firm with no extensions or grace periods available.
What if project delays are beyond my control? Unfortunately, the reasons for delays don’t affect eligibility. The asset must still be acquired and ready for use by the deadline regardless of the cause of any delays.
Does this apply to all business assets? Most business assets qualify, but there are some exclusions. Check the official IRD guidance for the complete list of qualifying and excluded assets.
How do I actually claim the boost? The boost is claimed through your regular income tax return process. Ensure you have proper documentation of asset acquisition dates and costs.
The Investment Boost deadline is non-negotiable, so planning your investments carefully around these dates is essential for maximizing your tax benefits.