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Instant Asset Write-Off

The Instant Asset Write-Off is an Australian tax incentive that allows eligible businesses to immediately deduct the full cost of certain new or used assets in the year they are first used or installed. It applies to assets such as vehicles, machinery, tools, medical devices, café equipment and commercial fitouts. This incentive strongly influences Equipment Finance, Vehicle Finance, Working Capital Loans, Business Line of Credit, and Invoice Finance. Related glossary terms: Depreciating Asset, Useful Life, Asset Type. Relevant blogs: Are Low Doc Equipment Loans Worth It?, Lease vs Buy Equipment.

Why Instant Asset Write-Off Matters

This tax deduction can improve cashflow by reducing taxable income. When combined with equipment or vehicle finance, it allows businesses to claim a full deduction while spreading payments over several years. It impacts:

  • Business cashflow planning
  • Loan structuring
  • Timing of asset purchases
  • Eligibility for Low Doc approvals
  • Borrowing capacity

It is one of the most powerful tax incentives for Australian SMEs when used with proper advice from an accountant or tax adviser.

How Instant Asset Write-Off Works

  • You buy or finance an eligible asset
  • The asset is used or installed by the relevant ATO cut-off date
  • You claim the full cost in the same financial year
  • Loan repayments can still be spread over 2–7 years
  • Thresholds and eligibility rules vary each year

Always check current ATO thresholds and rules before purchasing.

Official reference: ato.gov.au

What is the Instant Asset Write-Off?
A tax deduction that lets eligible businesses instantly deduct the cost of qualifying assets.
Can you finance an asset and still claim the write-off?
Yes — you can finance the asset and still claim the full deduction if it meets ATO criteria.
Does the asset need to be new?
No — used assets may qualify depending on ATO rules for that year.
Do thresholds change each year?
Yes — the government updates thresholds and eligibility annually.
Is there a limit to how many assets you can claim?
Businesses can generally claim multiple assets as long as each meets ATO requirements.