Small business – $20,000 instant asset write-off
The Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Act 2025External Link has extended the $20,000 instant asset write off limit to the 2025–26 income year. The measure aims to support small business entities (with an aggregated annual turnover of less than $10 million).
Eligible small business entities can immediately deduct the business use portion of the cost of eligible depreciating assets costing less than $20,000. Such assets must have been first used or installed ready for use for a taxable purpose between 1 July 2025 and 30 June 2026.
The $20,000 limit applies on a per asset basis, so small business entities can instantly write off multiple assets. Small business entities can also immediately deduct an eligible amount included in the second element of a depreciating asset's cost.
The 5-year 'lock out' rule is suspended until 30 June 2026. Normally this rule prevents small business entities from re-entering the simplified depreciation regime if they opted out.
To claim a deduction under the instant asset write-off, complete:
- section Capital allowances, label Total depreciation deducted for income year in the AMIT tax return
- section Assessable income, subsection Income - other than capital gains, label Other Deductions in the AMIT tax schedule.
For more information, see Small business support – $20,000 instant asset write-off.
Denying deductions for ATO interest charges
The Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025External Link amended the tax law to deny income tax deductions for general interest charges (GIC) and shortfall interest charges (SIC). The amendments apply in relation to assessments for income years starting on or after 1 July 2025.
This means most taxpayers can't claim a deduction for GIC and SIC incurred on or after 1 July 2025 from their 2025–26 income tax return and onwards. GIC and SIC incurred before 1 July 2025 will continue to be deductible for the 2024–25 and earlier income years.
For taxpayers with an approved substituted accounting period (SAP), the law applies in a different way. This law change means that a taxpayer will no longer be able to claim a deduction from their next SAP starting after 1 July 2025. The SAP is itself considered an 'income year'.
For example, a taxpayer with an approved SAP from 1 January 2025 to 31 December 2025 may deduct any GIC and SIC incurred for this period in their 2025–26 tax return. They can't deduct GIC and SIC amounts from their next SAP starting on 1 January 2026.
As GIC and SIC are no longer deductible, any GIC or SIC that is later remitted, will no longer need to be included as assessable income in the year in which the remission occurred. Remissions of GIC and SIC are assessable only if the original interest was deductible.
Any GIC or SIC incurred prior to 1 July 2025 that is later remitted must be included in assessable income in the year in which the remission occurred.
For more information see, Denying deductions for ATO interest charges.
Reportable Tax Position Schedule
For income years that commence on or after 1 July 2025, Attribution Managed Investment Trusts will be required to lodge a Reportable tax position schedule if they meet the reportable tax position criteria.
The reportable tax position schedule question can be found at Reportable Tax Position.
Changes to the AMIT tax return 2026
In the Attribution managed investment trust tax return 2026, changes to the following sections include:
- addition of new section Reportable tax position and question Are you required to lodge a reportable tax position schedule?
Continue to: How to lodge your AMIT tax return and pay
Return to: Features of the AMIT tax return