(8 May 2026 – Australia) The popular instant asset write‑off provision (IAWO) is set to become a permanent feature of the Australian tax system ahead of the federal budget release this week.
The move locks in the A$20,000 tax break for new and replacement/second-hand assets, new housing infrastructure funding and AI‑driven approvals as a key tenet of the federal budget as part of a wider productivity push, a move that has been long advocated for by industry associations.
Enterprises with sub A$10 million annual business turnover can now continually deduct the full cost of eligible depreciating assets costing less than A$20,000 as opposed to a mooted constricted cap of A$1,000 from 1 July as previously planned. The A$20,000 limit will apply on a per‑asset basis, meaning multiple purchases of equipment, vehicles, tools or technology can each be claimed in full at the end of the financial year.
Businesses have grown increasingly frustrated with the level of uncertainty brought about by required legislative approval each year and a key element of the budget measure was enabling simpler depreciation rules to reduce time spent dealing with the tax system.
“We’ll save small businesses thousands of dollars by making the instant asset permanent in the Budget on Tuesday. This means small businesses will be able to immediately deduct every piece of new equipment worth up to $20,000, from new tech to tools to machinery. This will help save small businesses 376,000 hours a year in compliance, cutting red tape and getting costs down in our economy” stated Treasurer Jim Chalmers.