For years, the $20,000 instant asset write-off operated on something close to an annual reprieve. It would be extended, usually in the Budget, usually welcomed by small business groups, and then everyone would wait to see whether it would happen again the following year. That cycle is now over.
Treasurer Jim Chalmers confirmed in the 2026-27 Federal Budget that the $20,000 instant asset write-off will become a permanent fixture of the Australian taxation system. The measure permanently extends from 1 July 2026, allowing businesses with turnover up to $10 million to immediately deduct eligible assets costing less than $20,000 in the same financial year they are purchased. Without the permanent extension, the threshold was scheduled to revert to the old default level of just $1,000.
That last point is worth sitting with for a moment. The alternative wasn’t a modest haircut. It was a drop from $20,000 back to $1,000. If you’ve been putting off a tech refresh because you weren’t sure what the rules were going to look like, now you know. Plan accordingly.
What the write-off actually means in practice
The instant asset write-off lets you deduct the full cost of an eligible asset in the year you buy it, rather than depreciating it over several years. The difference is meaningful for cash flow. Instead of claiming a fraction of the cost annually across a depreciation schedule, you take the whole deduction upfront, which reduces your taxable income in the year you need it most.
The $20,000 threshold applies on a per-asset basis, meaning multiple qualifying purchases can be claimed within the same financial year. Buy a new laptop, a POS terminal, and a network switch all in the same year, and each one is assessed individually against the threshold, not bundled together. That’s a significant point that some business owners miss.
The permanent extension is expected to save small businesses around $32 million per year in compliance costs alone, which gives you a sense of how much administrative drag the old temporary arrangements were creating.
The tech angle: where this actually applies
Technology is one of the clearest and most practical applications of this write-off for small businesses, and it’s an area where many Australian operators are genuinely overdue for an upgrade. Here’s how the major categories line up.
Laptops and desktop computers
A business-grade laptop from a reputable brand sits comfortably under the $20,000 threshold, often well under it. If your team is working on hardware that’s four or five years old, running slow, struggling with current software, or causing IT headaches that cost more in lost time than the machine itself is worth, this is a clean justification to refresh. Each device is its own asset for write-off purposes, so outfitting a small team with new machines in the same financial year is entirely legitimate.
Point of sale systems
Modern POS systems do considerably more than process transactions. Inventory management, customer data, integrated EFTPOS, loyalty programs, reporting dashboards: a proper POS setup can meaningfully change how a retail or hospitality business operates. The hardware and software components of a POS system can both potentially qualify, though it’s worth confirming with your accountant how your specific setup is treated, particularly if there are subscription components involved.
Accounting and business software
This is where it gets a little nuanced. Perpetual software licences, the kind where you pay once and own it, are generally treated as depreciating assets and can qualify. Subscription-based software is typically treated as an operating expense and deducted differently. If you’ve been considering a move to a more comprehensive accounting platform, project management system, or CRM, the distinction matters and your accountant should be your first call before assuming how it’ll be treated.
Cybersecurity hardware and infrastructure
This is increasingly non-negotiable for any small business handling customer data or processing payments, and the costs are real. Firewall appliances, network security hardware, encrypted backup drives, and managed security devices can all sit within the write-off threshold. Given that the cost of a single data breach vastly exceeds the cost of basic preventive infrastructure, this is arguably the highest-return tech category to prioritise.
Tablets and mobile devices
iPads and Android tablets used for business purposes, whether for customer-facing applications, field work, inventory scanning, or mobile payments, are straightforward assets that qualify. Paired with the right software, a tablet refresh can modernise customer experience in retail or hospitality settings at a cost that sits well within the threshold.
Printers, scanners, and office hardware
Less exciting than the categories above, but entirely valid. A quality multifunction printer or document scanner bought for the business is an eligible depreciating asset. If your office hardware is limping along, the write-off applies here too.
A few things to be clear on
Assets valued at $20,000 or more can still be written off, but must be depreciated over several years at 15 per cent in the first income year and 30 per cent each income year after that, under the simplified depreciation rules.
The asset needs to be used for business purposes. If a laptop is used partly for personal use, only the business-use portion of the cost is deductible. Mixed-use assets need to be apportioned, and again, your accountant is the right person to help you determine the appropriate split.
The write-off is available to businesses with an aggregated turnover of less than $10 million and covers both new and second-hand items. Second-hand gear is legitimately included, which opens up the possibility of buying quality refurbished equipment and still claiming the deduction.
Why now is a good time to move
The permanent nature of the write-off removes the urgency argument that used to get attached to these announcements. You no longer need to rush a purchase before June 30 because the rules might change. What the permanence does create is a stable planning environment. You can now build technology refresh cycles into your business planning with genuine confidence about how the tax treatment will work, year after year.
That said, if there’s equipment you’ve been deferring because you weren’t sure the write-off would continue, the Budget has answered that question. The new financial year from 1 July 2026 is a natural point to act. The NSW Small Business Commissioner and business.gov.au both have solid summaries of the broader Budget measures for small business if you want to read across the full picture.
The usual disclaimer, because it matters
This article is general information, not tax advice. The instant asset write-off has eligibility conditions, and whether a specific purchase qualifies in your specific circumstances depends on factors that a registered tax agent or accountant can assess properly. The ATO’s guidance page has detailed eligibility information, and a conversation with your accountant before making significant purchases is the right move.
The broad picture is genuinely good news for small businesses that have been watching this space. A permanent write-off at a useful threshold, with no expiry date and no annual anxiety about whether it will be extended again. For Australian small businesses considering a technology upgrade, the conditions are about as clear as they’ve been in over a decade.
