As of June 2025, the Australian Government has extended the Instant Asset Write-Off (IAWO) scheme for the 2024–25 financial year. This measure allows eligible small businesses to immediately deduct the full cost of qualifying assets up to $20,000, provided certain conditions are met.
✅ Eligibility Criteria
To qualify for the IAWO in 2024–25:
Business Type: Must be a small business entity (SBE) operating under general principles.
Annual Turnover: Aggregated annual turnover must be less than $10 million.
Asset Use: The asset must be first used or installed ready for use between 1 July 2024 and 30 June 2025.
Asset Cost: The asset’s cost must be less than $20,000 (GST exclusive).
Business Purpose: The asset must be used for taxable business purposes.
Assets can be both new and second-hand, and the $20,000 threshold applies on a per-asset basis, allowing businesses to claim multiple assets.
🛠️ Eligible Assets
Common assets that qualify include:
Vehicles (work vans, trucks, business-use cars)
Office equipment (computers, printers, desks)
Machinery and tools
Technology hardware (laptops, POS systems)
Solar panels and energy-efficient equipment
Agricultural machinery and equipment
Manufacturing equipment
However, certain assets are excluded, such as capital improvements to buildings, intangible assets (like software), and assets not used primarily for business purposes.
Also Read : IRS $3000 Tax Refund Eligibility
📅 Important Dates
Purchase Deadline: Assets must be purchased and installed ready for use by 30 June 2025.
Tax Deduction: The deduction applies in the financial year the asset is first used or installed ready for use.
It’s crucial to ensure that assets are installed and ready for use before the deadline to qualify for the write-off.
📄 How to Claim
To claim the IAWO:
Keep Records: Maintain receipts, invoices, and proof of purchase.
Determine Business Use: Ensure the asset is used for taxable business purposes.
Lodge Tax Return: Report the asset cost under the business expenses section of your tax return.
Consult a Professional: Consider seeking advice from a tax professional to maximize your claim.
⚠️ Important Considerations
Asset Installation: Assets must be installed and ready for use before 30 June 2025.
Depreciation for High-Value Assets: Assets costing more than $20,000 cannot be claimed under the IAWO but may be eligible for small business pooling.
Record Keeping: Proper documentation is essential to substantiate your claim.
🧾 Additional Support
The government has also introduced a bonus deduction under the small business energy incentive for eligible energy-efficient assets purchased in the 2023–24 income year.
