Eligible small businesses can immediately deduct the business-use portion of eligible depreciating assets costing less than $20,000 when the asset was first used, or installed ready for use, during the 2025–26 income year.
Who may qualify
The measure generally applies to small business entities with aggregated annual turnover of less than $10 million that choose to use the simplified depreciation rules.
The limit applies per asset
The $20,000 threshold applies to each asset, so an eligible business may claim the write-off for multiple separate assets. The asset must cost less than the threshold. Business and private use must be apportioned.
Timing matters
Ordering or paying for an asset is not always enough. The key date is generally when it is first used or installed ready for taxable use. Keep the invoice, payment record and evidence of when the asset became ready for use.
Assets at or above the threshold
Assets costing $20,000 or more are not immediately written off under this measure. If the simplified depreciation rules apply, they may generally enter the small-business pool and be depreciated over time.
A permanent $20,000 threshold from 1 July 2026 has been announced and legislation was introduced in June 2026. Check the enacted position before relying on it for a 2026–27 purchase.