Bill passed for Instant Asset Write-Off of $20,000 for 2024-25

There was no mention of the extension of the instant asset write-off (IAWO) within the Federal Budget delivered last Tuesday night, leaving many small business taxpayers frustrated and uncertain.

However, the Treasury Laws Amendment (Tax Incentives and Integrity) Bill 2025 has now been passed through the Parliament, and it included the extension of the IAWO threshold of $20,000 for assets first used or installed ready for use between 1 July 2024 and 30 June 2025.

After the Bill has now been passed by both the House of Representatives and the Senate, it now simply waits to receive Royal assent.

Instant asset write-off threshold is $20,000

The IAWO threshold is $20,000, for assets first used or installed ready for use between 1 July 2024 and 30 June 2025.

It is important to note that the IAWO threshold of $20,000 applies only to small business entities, with aggregated turnover of less than $10 million.

This should give small business taxpayers some certainty now to purchase assets and use them (or have them installed ready for use) before 30 June 2025, to entitle them to an immediate tax deduction in their 2025 tax return.

We expect that the IAWO threshold for next year, ending 30 June 2026, will become an election issue for impending federal election, with the Coalition already indicating it has plans to make the IAWO permanent with a threshold of $30,000, if it forms government at the next election. 

We would welcome either party to make the IAWO a permanent deduction and remove the annual uncertainty of waiting until the later stages of each tax year to have the requisite legislation passed.