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Last chance to use the $20,000 immediate write-off deduction

By Emma Brooke and Carissa Gunston

As we near the end of the financial year it is a good time to consider the $20,000 immediate write off deduction available to small businesses. This deduction (which is also known as the instant asset write-off) has been available since 12 May 2015 and was extended to 30 June 2018.

This deduction is available to small businesses. That is, an entity that is carrying on a business with an annual turnover of less than $10 million. In the past, the threshold was limited to businesses with an annual turnover of only $2 million, but you may not be aware that the threshold was increased to $10 million on 1 July 2016.

What it means is that if you are a small business and you purchase a new or second hand asset for less than $20,000 excluding GST, you can claim an immediate deduction for that expenditure.  This replaces the need to depreciate the asset over its effective life; which can be quite a substantial period of time depending on the asset. 

Assets that cost $20,000 or more cannot immediately be deducted, and should continue to be deducted over time using the general small business pool. 

With only one month to go, bear in mind that the $20,000 immediate write off deduction will not be available after the end of this financial year. So, with 30 June 2018 fast approaching, if there is an asset that you need in your business that will cost less than $20,000 excluding GST, now might be a great time to make that purchase and claim your immediate deduction. Of course, getting a deduction shouldn’t be the driving reason behind purchasing a new asset, but if it is something that you need and it makes good commercial sense, then why not buy it before 30 June.

For more information about the $20,000 instant asset write off visit the ATO.

Or you can email your questions to

By Emma Brooke, Financial Adviser, GTC Financial and Carissa Gunston, Client Manager, GTC Financial

Emma Brooke is an Authorised Representative and GTC Financial Services Pty Ltd ABN 94 010 624 914 is a Corporate Authorised Representative of Infocus Securities Australia Pty Ltd ABN 47 097 797 049 AFSL and Australian Credit Licence No. 236523

This information is general information only. You should consider the appropriateness of this information with regards to your objectives, financial situation and needs.

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