$20,000 instant asset write-off for small business extended to 30 June 2025

Small businesses can continue to benefit from the instant asset write-off until 30 June 2025. This means they can immediately deduct the full cost of eligible assets valued under $20,000 when they start using them for business purposes between 1 July 2024 and 30 June 2025. This concession helps small businesses manage their cash flow by reducing their taxable income in the year they buy new assets like equipment or machinery.

The $20,000 threshold will be implemented individually for each asset, allowing small businesses to immediately write off the cost of multiple assets. This means that if a small business purchases several assets, each costing up to $20,000, they can deduct the full cost of each asset in the year they were bought.

For assets valued at $20,000 or more, which cannot be immediately deducted, they can still be added to the small business simplified depreciation pool. In the first year after purchase, these assets will be depreciated at a rate of 15%. Subsequently, they will depreciate at a rate of 30?ch year.

The measure is included in a bill currently under consideration in Parliament, meaning it has not yet become law. The Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023 was approved by the Senate on 27 March 2024 with an amendment concerning the instant asset write-off, pending approval by the House of Representatives

Disclaimer: The material and contents provided in this blog are general guide and informative in nature only. They are not intended to be seen as legal and tax advice. If expert assistance is required, you should seek your own advice for any legal, tax or investment issues raised in your affairs.