Australia: ATO guidance on eligibility of instant asset write-off

Businesses with an aggregated annual turnover of less than $10 million may qualify to immediately deduct the business portion of eligible asset costs.

The Australian Taxation Office (ATO) on May 5, 2025, released on determining business eligibility for the $20,000* instant asset write-off for the 2024-2025 income year. Businesses with an aggregated annual turnover of less than $10 million using simplified depreciation rules may qualify to immediately deduct the business portion of eligible asset costs.

Eligible depreciating assets costing less than $20,000, first used or installed for a taxable purpose between July 1, 2024, and June 30, 2025, can be fully deducted.
Both new and second-hand assets may qualify, though some exclusions and limits apply.
Businesses that previously claimed an immediate deduction for an asset under simplified depreciation rules can also deduct the first improvement cost for that asset, provided it is incurred between July 1, 2024, and June 30, 2025, and is less than $20,000.
The $20,000 limit applies to each asset individually, permitting businesses to write off multiple assets provided each asset does not exceed the limit.

The ATO emphasizes that standard deduction rules remain in effect and businesses must maintain records to substantiate claims.

*$ = Australian dollar

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