Instant Asset Write Off - Does it Apply to Me?

Instant asset write-off for eligible businesses

Eligible businesses can claim an immediate deduction for the business portion of the cost of an asset in the year the asset is first used or installed ready for use.

Instant asset write-off can be used for:

• multiple assets, if the cost of each individual asset is less than the relevant threshold

• new and second-hand assets.

If you are a small business, you will need to apply the simplified depreciation rules in order to claim the instant asset write-off. It cannot be used for assets that are excluded from those rules.

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 depending on when the asset was purchased, first used or installed ready for use.

Eligibility

Eligibility to use instant asset write-off on an asset depends on:

• your aggregated turnover (the total ordinary income of your business and that of any associated businesses)

• the date you purchased the asset

• when it was first used or installed ready for use

• the cost of the asset being less than the threshold.

You are not eligible to use instant asset write-off on an asset if your aggregated turnover is $500 million or more.

If temporary full expensing applies to the asset, you do not apply instant asset write-off.

Thresholds

The thresholds have changed over recent years.

Instant asset write-off thresholds for small businesses that apply the simplified depreciation rules

Eligible businesses

Date range for when asset first used or installed ready for use

Threshold

Less than $10 million aggregated turnover

FOR 25/26 THE THRESHOLD HAS REDUCED TO $1,000.00

12 March 2020 to 30 June 2021, providing the asset was purchased on or after 7.30pm (AEST) on 12 May 2015 and by 31 December 2020

$150,000

Less than $10 million aggregated turnover

7.30pm (AEDT) on 2 April 2019 to 11 March 2020

$30,000

Less than $10 million aggregated turnover

29 January 2019 to prior to 7.30pm (AEDT) on 2 April 2019

$25,000

Less than $10 million aggregated turnover

1 July 2016 to 28 January 2019

$20,000

Less than $2 million aggregated turnover

7.30pm (AEST) on 12 May 2015 to 30 June 2016

$20,000

Less than $2 million aggregated turnover

1 January 2014 to prior to 7.30pm (AEST) 12 May 2015

$1,000

Less than $2 million aggregated turnover

1 July 2012 to 31 December 2013

$6,500

Less than $2 million aggregated turnover

1 July 2011 to 30 June 2012

$1,000

Instant asset write-off thresholds for businesses with an aggregated turnover of $10 million or more but less than $500 million

Eligible businesses

Date range for when asset first used or installed ready for use

Threshold

Less than $500 million aggregated turnover

12 March 2020 to 30 June 2021 providing the asset was purchased on or after 7.30pm (AEST) on 2 April 2019 and by 31 December 2020

$150,000

Less than $50 million aggregated turnover

7.30pm (AEDT) on 2 April 2019 to 11 March 2020

$30,000

Make sure you have checked the eligibility criteria for your business.