Can I Claim Instant Asset Write-Off as a Business Expense in Australia?
Yes, small businesses (aggregated turnover under A$10 million) can immediately deduct the cost of eligible depreciating assets up to A$20,000 per asset (the limit applied for 2025-26, and the Government has made it permanent from 1 July 2026). Multiple assets can be written off: the threshold is per asset.
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What Australian Taxation Office (ATO) says
Section 328-180 ITAA 1997 allows immediate write-off of eligible depreciating assets first used or installed ready for use in the income year, with cost under the threshold. The A$20,000 limit applied for assets first used or installed ready for use from 1 July 2025 to 30 June 2026, and the ATO says the measure is now law as a permanent A$20,000 limit from 1 July 2026. The rule that stops a business from re-entering the simplified depreciation regime for five years after leaving it is suspended until 30 June 2027. An asset that costs A$20,000 or more cannot use the write-off at all and goes into the small business simplified depreciation pool, which is written off at 15 percent in the first year and 30 percent a year after that. The write-off covers new and second-hand assets and is limited to the business-use portion.
When you can claim
- Computers, laptops, phones costing under A$20,000
- Office furniture and tools
- Trade tools and small equipment
- Multiple assets each under the threshold (no aggregation)
- Second-hand equipment and tools bought for the business, each under the limit
When you cannot claim
- Assets above the threshold (depreciate normally)
- Buildings and structural improvements
- Trading stock / inventory
- Cars beyond the car limit (A$69,674 FY25)
- The private-use portion of an asset used partly for private purposes
Good to know
Pro tip: Keep the invoice, the date the asset was first used or installed ready for use, and a note of the business-use percentage. The date of first use decides which year the deduction falls in.
Important: The A$20,000 limit is permanent from 1 July 2026 according to the ATO, which replaces earlier annual extensions. Check the ATO page before a large purchase, because Parliament has changed this limit many times.
Related expenses
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