The Australian Taxation Office (ATO) released guidance, on 5 May 2025, about business eligibility for the AUD 20,000 instant asset write-off for 2024-2025. Businesses with a turnover under AUD 10 million using simplified depreciation rules may qualify to instantly deduct the business portion of eligible asset costs.
The conditions are as follows:
- The full cost of eligible depreciating assets costing less than AUD 20,000 that are first used or installed ready for use for a taxable purpose between 1 July 2024 and 30 June 2025.
- New and second-hand assets can qualify, although some exclusions and limits apply.
- If anyone claimed an immediate deduction for an asset’s cost under the simplified depreciation rules in an earlier income year, they also immediately deduct the first improvement cost for that asset if it is incurred between 1 July 2024 and 30 June 2025 and is less than AUD 20,000.
- The AUD 20,000 limit applies on a per-asset basis, so businesses can instantly write off multiple assets as long as the cost of each asset is less than the limit.
The standard rules for claiming deductions remain unchanged. Only the business portion of an expense can be claimed, and records must be kept as evidence. The ATO reminds businesses that standard deduction rules still apply and that maintaining proper records to support their claims is essential.
