I run a small business and bought a new oven before 30 June — can I write the whole thing off this year?

You run a café, a small trades business or a shop, and somewhere in June you finally replaced the thing that had been limping along — a $9,000 oven, a $14,000 set of tools, a couple of laptops for the office. You've heard about the 'instant asset write-off' and you're hoping the whole cost comes straight off this year's tax, rather than being dribbled out over a decade of depreciation. For most small businesses that hope is well founded — but there are three details that decide whether it actually works, and one line about 'it's permanent now' that has changed since this was written.

Update, 27 August 2026: the Treasury Laws Amendment (Tax Reform No. 2) Bill 2026 referred to below passed both Houses of Parliament on 19 August 2026 and received Royal Assent on 26 August 2026. It is now Act No. 71 of 2026. The permanent $20,000 threshold from 1 July 2026 is law, and we have set out what that does and does not change in a separate piece.

What the write-off actually does

The instant asset write-off lets an eligible small business claim an immediate deduction for the business portion of the cost of a depreciating asset — equipment, tools, a computer — in the year it's first used or installed ready for use. To use it, your aggregated turnover (your business's turnover plus that of connected and affiliated entities) has to be under $10 million and you have to be using the simplified depreciation rules. The threshold is that each asset must cost less than $20,000.

The point of it is timing. Normally an asset like this is depreciated a slice at a time over several years; the write-off collapses that into a single deduction in the year you start using it. For a business watching its cash, getting the whole deduction now instead of spread across a decade is the difference that matters.

The three details that decide it

First, it's per asset, not a $20,000 total. You can write off multiple assets — new or second-hand — as long as each individual one costs less than $20,000. So a $9,000 oven and a $14,000 set of tools both qualify separately, even though together they come to $23,000. It's the individual price tag that's tested, not your total spend.

Second, if you're registered for GST the $20,000 is a GST-exclusive figure. Where you can claim the full GST credit on a purchase, you take the GST out before measuring the cost against the threshold — so an asset priced at $21,000 including GST is $19,091 once the GST is stripped out, and it squeaks under. If you're not registered for GST, you use the GST-inclusive price instead.

Third, you only claim the business-use portion, and the trigger is 'installed ready for use', not 'paid for'. If a laptop is used 70% for the business, you write off 70% of its cost. And if you paid a deposit in June but the equipment wasn't delivered and ready to use until July, the deduction lands in the next income year — what counts is when it's ready to use, not the date on the invoice.

What happens if the asset is $20,000 or more

If a single asset costs $20,000 or more, it doesn't miss out on a deduction — it just can't be written off all at once. Instead it goes into your small business pool, which is deducted at 15% in the first year and 30% for each year after that. So a $25,000 asset is still fully deductible over time; you just claim it gradually rather than in one hit. Knowing which side of the $20,000 line an asset falls on is what tells you whether the deduction is immediate or spread out.

The 'it's permanent now' trap

Here's the part worth being careful about. In the 2026–27 Budget, handed down on 12 May 2026, the government announced it would make the $20,000 instant asset write-off permanent from 1 July 2026. That announcement travelled in the Treasury Laws Amendment (Tax Reform No. 2) Bill 2026, which passed both Houses of Parliament on 19 August 2026 and received Royal Assent on 26 August 2026 as Act No. 71 of 2026. The threshold for the year from 1 July 2026 is no longer a Budget line or a bill — it is law.

The $20,000 limit for the year that just ended — 1 July 2025 to 30 June 2026 — was already law separately, locked in by the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Act 2025. So for the 2025–26 return you're lodging now, you can rely on the $20,000 figure. For purchases you're planning in the new financial year, the $20,000 is settled, with the caveat that 'permanent' means the threshold stops lapsing each 30 June, not that the figure rises.

So the practical version is calmer than it sounds. A $9,000 oven you started using in June comes straight off your 2025–26 return in full; if you bought several things, each one under $20,000 counts on its own; take the GST out first if you're registered; and claim only the business share. The one line not to over-read is 'permanent' — it means the $20,000 stops expiring every 30 June, not that the number gets bigger.

This is general information current as at July 2026, not advice for your situation — how it applies depends on your turnover, whether you use the simplified depreciation rules, and how each asset is used in the business. If you're timing a larger purchase around the end of the financial year, or you're not sure whether something belongs in the write-off or the small business pool, that's worth getting right before you lodge rather than after. That is what our business, company and bookkeeping service is for.