Depreciation & the $20,000 Instant Asset Write-Off
Bought a laptop, tools, a vehicle or equipment for your business? Instead of claiming it all at once, most assets are claimed over time through depreciation – but small businesses can often write off assets under $20,000 straight away.
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The instant asset write-off
Who can use it
Small businesses with aggregated turnover under $10 million using the simplified depreciation rules.
How much
Assets costing less than $20,000 each can be written off immediately. The limit applies per asset, so you can write off several.
Now permanent
The $20,000 threshold has been made permanent from 1 July 2026.
Bigger assets
Assets of $20,000 or more go into a small business depreciation pool and are claimed over time.
Depreciation for everyone else
Larger businesses, and assets that don’t qualify for the write-off, are usually depreciated over their effective life. The deduction is spread over several years.
Rental property depreciation
- Building costs (capital works) can often be claimed over 40 years, usually at 2.5% a year
- Plant and equipment such as appliances and carpets can be depreciated – but for second-hand residential property bought after 9 May 2017, previously used items generally can’t be claimed
- A depreciation schedule from a qualified quantity surveyor helps you claim correctly
Tips
- Keep invoices showing the date and cost
- Only claim the business-use portion of mixed-use assets
- The asset must be used or installed ready for use in the year
- Buying an asset just for a deduction still costs you money – think about cash flow
How UV TAX helps
- Work out what you can write off or depreciate
- Set up your depreciation and pool records
- Plan big purchases before 30 June
- Claim rental property depreciation correctly
⚠️ General information only – not tax or legal advice. Eligibility for the instant asset write-off and depreciation depends on your business, the asset and when it was bought and used. This page is a simple overview as at November 2026 and does not consider your personal circumstances. Tax laws, rates and thresholds change regularly. Please get advice for your situation before acting.
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0466 268 405Frequently asked questions
What is the instant asset write-off threshold?
$20,000 per asset for small businesses with aggregated turnover under $10 million, made permanent from 1 July 2026.
Can I write off a car?
Cars can qualify if the cost is under the threshold and used for business, but car limits and private use rules also apply.
Can I claim depreciation on a rental property?
Usually yes – on the building (capital works) and certain plant and equipment, subject to the rules.
Do I need a depreciation schedule?
For rental properties, a quantity surveyor’s schedule is usually the best way to claim correctly.
Related
General information current as at November 2026.