Instant asset write-off for eligible businesses as outlined by the Australian Taxation Office

Under instant asset write-off eligible businesses can:

• Immediately write off the cost of each asset that cost less than the threshold
• Claim a tax deduction for the business portion of the purchase cost in the year the asset is first used or installed ready for use

Instant asset write-off can be used for both new and second-hand assets. Some exclusions and limits apply.

The instant asset write-off eligibility criteria and threshold have changed over time. You need to check your business’s eligibility and apply the correct threshold amount.

Recent changes

For assets first used or installed ready for use between 12 March 2020 until 30 June 2021, and purchased by 31 December 2020, the instant asset write-off:

• Threshold amount for each asset is $150,000 (up from $30,000)

• Eligibility extends to businesses with an aggregated turnover of less than $500 million (up from $50 million)

From 7.30pm AEDT on 6 October 2020 until 30 June 2022, temporary full expensing allows a deduction for:

• The business portion of the cost of new eligible depreciating assets for businesses with an aggregated turnover under $5 billion or for corporate tax entities that satisfy the alternative test

• The business portion of the cost of eligible second-hand assets for businesses with an aggregated turnover under $50 million

• The balance of a small business pool at the end of each income year in this period for businesses with an aggregated turnover under $10 million

We recommend before you buy to consult your tax agent.

To find out more about eligibility and exclusions click here