Instant Asset Write-Off 2025–26: Extension Status and Core Rules
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Primary tax-year context: 2025-26
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Status of the 2025–26 extension
A Treasury Laws Amendment Bill proposes extending the $20,000 instant asset write-off to 30 June 2026 for eligible small business entities. The bill specifies that an asset must be first used or installed ready for use between 1 July 2025 and 30 June 2026 to qualify. The measure is not law until the bill receives Royal Assent.
If the extension does not pass, the threshold is scheduled to revert to $1,000 from 1 July 2026.
Who is eligible
The instant asset write-off applies to small business entities using the simplified depreciation rules, generally those with aggregated turnover under $10 million.
How the rules work in practice
- Per asset basis: The $20,000 threshold is per asset, not total spend.
- Timing test: The asset must be first used or installed ready for use in the 2025–26 income year.
- Assets $20,000 or more: These go into the small business pool.
Small business pool rates
For assets added to the pool, the standard deduction rates are:
- 15% in the year the asset is first used or installed ready for use.
- 30% in later years for the pool balance.
Practical checklist
- Confirm your aggregated turnover is under $10 million.
- Track installation or first‑use dates to meet the timing test.
- Keep invoices and evidence of business‑use percentage.
- Monitor the bill’s passage before finalising significant purchases.