Instant Asset Write-Off Calculator

Understanding the instant asset write-off

The instant asset write-off allows eligible businesses to immediately deduct the cost of qualifying assets in the year they are first used or installed, rather than depreciating them over several years. For FY2024-25 the threshold is $20,000 per asset for businesses with aggregated turnover under $10 million. Assets costing $20,000 or more go into the small business simplified depreciation pool.

The threshold amount refers to the GST-exclusive cost if your business is registered for GST, or the GST-inclusive cost if not. Only the business-use percentage of the asset is deductible - if you use a $15,000 laptop 80% for business, the deductible amount is $12,000.

How to use this instant asset write-off calculator

1. Enter the total cost of the asset (GST-exclusive if registered for GST, GST-inclusive if not).
2. Enter the percentage of business use - the deduction is proportional to business use only.
3. Select your business entity type and tax rate to calculate the actual tax saving.
4. The calculator checks whether the asset falls under the $20,000 instant write-off threshold or goes into the simplified depreciation pool.
5. Review the immediate deduction amount, tax saving, and any remaining pool depreciation schedule.

Eligibility rules for Australian small businesses

To claim the instant asset write-off, your business must have an aggregated turnover of less than $10 million and be using the simplified depreciation rules. Sole traders, partnerships, companies, and trusts are all eligible provided they meet the turnover test. The asset must be first used or installed ready for use within the relevant financial year. Excluded assets include horticultural plants, in-house software allocated to a software development pool, and assets leased to another entity on a depreciating asset lease. If your business has previously opted out of the simplified depreciation rules, a lock-out period of five years may apply before you can re-enter the system - though this lock-out was suspended for several years during COVID and has since been reinstated.

How does AP automation help with asset tracking?

Correctly claiming asset write-offs requires purchase invoices to be captured with the right amount, GST treatment, and asset classification. When supplier invoices are processed manually, assets can be miscoded as expenses (or vice versa), leading to incorrect deductions or missed write-off opportunities. Automating accounts payable ensures every asset purchase is captured accurately from the invoice, coded to the correct asset account, and flagged for write-off eligibility at tax time.