```html EOFY Tax Guide · 2025-26 · Small Business $20,000 Instant Asset Write-Off: What Small Businesses Need to Know The end of financial year is a great time to review what your business needs — and to understand which purchases might reduce your tax bill. If your business has a turnover under $10 million, the instant asset write-off could be worth knowing about. New to tax deductions? A tax deduction reduces the amount of income your business is taxed on — it’s not a cash refund. More on this below. What is the instant asset write-off? Normally, when a business buys an asset, such as equipment or technology, the tax deduction is spread out over many years. This is called depreciation. The instant asset write-off is a special rule that lets eligible businesses claim the full cost of a qualifying asset as a deduction in the same year they buy it, rather than waiting. For the 2025-26 financial year, the threshold is $20,000 per asset, and this rule is now law. The Government has also announced plans to make the $20,000 threshold permanent from 1 July 2026, though this is not yet law. Could your business be eligible? Your business may qualify if it meets both of these conditions: Aggregated annual turnover of less than $10 million You use the simplified depreciation rules for your business Not sure if you qualify? Tax rules can vary depending on your business structure and circumstances. Always check with your accountant or tax adviser before making a purchase based on this. What kinds of assets could you claim? Eligible assets are items used primarily for your business. Some common examples include: Laptops, tablets, and computers TVs or screens for presentations Printers and office equipment Fridges, freezers, and whitegoods Coffee machines for staff or customer areas Other business-use appliances and equipment The $20,000 limit applies per asset — so if you buy multiple items that each cost under $20,000, you may be able to claim each one, provided they all meet the eligibility rules. Common Questions Does this mean I get $20,000 back? No. A tax deduction reduces your taxable income, not your bank balance. For example, if your business has $100,000 in taxable income and you claim a $15,000 deduction, you’d only be taxed on $85,000. The actual cash saving depends on your tax rate. What if the asset costs $20,000 or more? Assets costing $20,000 or more cannot be claimed immediately under this rule. Instead, they are generally placed into the small business depreciation pool and claimed gradually over time. What does ‘aggregated turnover’ mean? Aggregated turnover is a measure of your business’s annual income that may also include the income of any related businesses or entities — not just your own. Thinking of upgrading before EOFY? If your business could benefit from new equipment, technology, or appliances, the end of financial year is a good time to assess what you need. Whether you’re refreshing your workspace, improving customer experience, or replacing old gear, eligible purchases may offer a tax benefit on top of the business value. Before you buy, make sure you: Confirm the item will mainly be used for business purposes Keep your receipt and tax invoice Make sure the asset is installed or ready to use before 30 June 2026 Speak with your accountant to confirm it qualifies under the rules A word of caution: Don’t make a purchase just for the tax benefit — make sure the item genuinely helps your business. And always confirm eligibility with your accountant first. Quick Glossary Not familiar with some of the terms used above? Here’s a plain-English explanation of each: Term Meaning Tax deduction Reduces your taxable income — not a cash refund Taxable income Your income after allowable deductions are subtracted Depreciation Spreading a deduction over several years instead of claiming it all at once Aggregated turnover Your total annual income, possibly including income from related businesses or entities Simplified depreciation rules A set of ATO rules designed to simplify how small businesses claim asset deductions Find Out More Visit the Australian Taxation Office website and search for “Small Business Support – $20,000 instant asset write-off” for official guidance and eligibility details. As always, speak with a registered tax adviser or accountant for advice specific to your business. Visit the ATO website ```
