What is the instant asset write-off threshold for 2024-25 in Australia?

The instant asset write-off allows eligible businesses to immediately deduct the cost of a qualifying depreciable asset in the income year it is purchased (first used or installed), rather than depreciating it over its effective life. For 2024-25, the instant asset write-off threshold and eligibility have been subject to legislative updates.

2024-25 position: The government has proposed extending an A$20,000 instant asset write-off threshold for small businesses (aggregated annual turnover less than A$10 million) for the 2024-25 income year. As at mid-2025, this measure was awaiting final legislative passage. Once legislated, eligible small businesses can immediately deduct assets costing less than A$20,000 that are purchased, first used or installed ready for use between 1 July 2024 and 30 June 2025.

If not yet legislated: The default threshold under the small business entity (SBE) simplified depreciation rules reverts to A$1,000 for assets not covered by the temporary measures. Always check the ATO website or your tax agent for the current enacted threshold before making purchasing decisions.

Who is eligible: Small business entities with aggregated annual turnover of less than A$10 million. The asset must be used or available for use for a taxable purpose and must not be subject to a financial arrangement that provides a depreciation deduction to someone else.

Practical tip: If you are planning to purchase business equipment near year-end, confirm the current legislative position with your tax agent. The threshold has changed multiple times in recent years due to COVID relief measures and subsequent wind-downs.