Small business – $20,000 instant asset write-off
The Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025External Link has extended the $20,000 instant asset write-off limit to the 2024-25 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. You must first use or install ready for use for a taxable purpose between 1 July 2024 and 30 June 2025.
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 2025. This rule prevented small business entities from re-entering the simplified depreciation regime if they opted out.
For more information, see Small business support – $20,000 instant asset write-off.
Effective life determinations
We've changed how we publish effective life determinations. Our effective life determinations are available in the Income Tax (Effective Life of Depreciating Assets) Determination 2015, a legislative instrument that has the full force of the law in Legislation Act 2003External Link.
Work out the decline in value of a depreciating asset on the basis of its effective life. You can either make your own estimate of its effective life or use the Commissioner's effective life determinations. For more information, see Effective life of an asset.
Continue to: Uniform capital allowances
Return to: Guide to depreciating assets 2025