Instant asset write-off extended but advocates call for more

The Albanese Government has pledged to extend the $20,000 instant asset write-off by another 12 months if re-elected – a move welcomed by small business advocates but seen as only a short-term fix to a long-term issue.

The write-off allows small businesses with annual turnover under $10 million to immediately deduct the full cost of eligible assets (each costing under $20,000) if they’re first used or installed ready for use by 30 June 2026. That includes things like tradie tools, kitchen equipment, office furniture and tech gear.

It’s part of Labor’s broader small business package, which also includes energy bill rebates, tax cuts for sole traders, and red tape reduction.

Prime Minister Anthony Albanese described the move as a way to help small businesses “grow, invest and prosper”.

“This is about giving businesses the confidence to invest in the equipment they need to boost productivity and thrive,” he said in a statement.

But with Australians heading to the polls on May 3, business groups are calling for more than another year of short-term relief – they want lasting certainty.

MYOB: Businesses need consistency and predictability

MYOB says support for small businesses will be a major factor in this election, with many business owners calling for sector-specific stimulus to counteract inflation.

“There is a ‘cost of doing business’ that is challenging this community,” MYOB CEO Paul Robson stated. “Our latest Bi-Annual Business Monitor survey of 1000+ SMEs has shown 40 per cent would vote for sector-specific stimulus in the federal election. Cashflow remains a key area of concern, with the cost of utilities topping the list of stressors for SMEs.”

The survey also revealed what’s top of mind for small business owners as election day approaches:

• A reduction in the company tax rate to 20% for small businesses (66%)
• Simplifying the GST and BAS reporting process (59%)
• Making the instant asset write-off permanent (58%)

“Small and mid-sized businesses play a vital role in our economy, contributing more than half of Australia’s GDP,” MYOB said. “Consistency and predictability are key to sustain the invaluable role SMEs have carved into the economy.”

CPA Australia: Make it permanent

CPA Australia’s Business Investment Lead, Gavan Ord, agrees that the write-off should be locked in for good.

“We are pleased with the one-year extension, but this measure needs to be made permanent to encourage investment,” Ord said.

“Long-term certainty is crucial for businesses, and the full potential of this policy will never be realised if it remains an annual measure.”

He also flagged the impact of global economic volatility, like the recent US tariff announcements, which make stability even more important for Aussie small businesses.

“Businesses hit by yesterday’s tariff announcements will be considering necessary investments to maintain profitability, such as diversifying their markets,” Ord added. “A one-year extension is still insufficient.”

CPA also noted that the Coalition has pledged to not only make the scheme permanent but to raise the threshold to $30,000 – a promise likely to appeal to businesses looking to make bigger purchases.

“This measure is important enough that we think it deserves bipartisan support rather than being a matter of politics and election sweeteners,” said Ord.

CA ANZ: Uncertainty is the real issue

Susan Franks, Tax and Superannuation Leader at Chartered Accountants ANZ (CA ANZ), echoed the need for permanency.

“Since 2015, the instant asset write-off has been clouded with uncertainty,” Franks said. “Governments keep extending it at the last minute, which leaves small businesses and tax agents in limbo.”

She said locking in the write-off would help reduce red tape for everyone involved – businesses, tax agents and government alike.

“The promise of another 12-month extension continues access to a crucial cash-flow tool, but it doesn’t resolve the underlying issue of ongoing uncertainty,” she said.

Franks said that the political debate has moved on from if the write-off should exist, to how much the cap should be – with proposals ranging from $20,000 to $50,000.

With the election just weeks away, small businesses will be watching closely to see what further support is on offer.

This post first appeared on Business Builders. you can read it here.

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