$20,000 Instant Asset Write-Off Extended – What Small Businesses Need to Know

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$20,000 Instant Asset Write-Off Extended – What Small Businesses Need to Know

What Is the Instant Asset Write-Off?
The instant asset write-off allows small businesses to claim an immediate tax deduction for the business portion of eligible assets purchased and installed ready for use. Under current legislation, the threshold is $20,000 per asset. You can claim multiple assets separately, provided each is under the $20,000 limit.

Eligibility Criteria
To access this write-off, your business must:

• ✅ Have an aggregated annual turnover of less than $10 million
• ✅ Be actively trading at the time of the purchase
• ✅ Purchase and install the asset between 1 July 2023 and 30 June 2025

What Can You Claim?
Eligible assets include:

• Tools, machinery, and work equipment
• Office desks, chairs, shelving, and partitions
• Technology like laptops, tablets, and phones
• Work vehicles (if the purchase price is below $20,000)
• POS systems, security cameras, and alarms
• Commercial fridges, freezers, and air-conditioning units

Each asset must be fully installed and ready for business use by 30 June 2025.

Excluded Assets
Not all purchases are eligible. You cannot claim:

• Assets costing $20,000 or more
• Capital works such as building renovations
• Assets leased to other businesses
• Intangible items like trademarks or goodwill

How Does It Help Your Business?
Instead of depreciating an asset over its useful life, the write-off lets you deduct the full value in the year it’s used. This offers:

• ✅ A faster tax deduction
• ✅ Reduced taxable income
• ✅ Greater incentive to invest in business growth
• ✅ Improved cash flow during the financial year

Record Keeping Requirements
To stay compliant, you must:

• Keep all tax invoices and receipts
• Record the date of purchase and installation
• Determine and apply the business-use percentage
• Ensure assets are used in your active business, not held for investment

How Trinity Accounting Practice Can Help
We assist small businesses by:

• Reviewing which assets are eligible
• Calculating business-use portions
• Ensuring the asset is fully deductible under the ATO’s rules
• Timing your purchases for the best tax outcome
• Avoiding ATO penalties and errors

Act Before 30 June 2025
To access the deduction, the asset must be ready for use in your business by the deadline. Planning purchases now ensures you benefit while staying within ATO guidelines.

Speak to Trinity Accounting Practice to plan your asset investments and maximise your tax position with confidence.

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