Who must comply with Instant Asset Write-Off (annually re-set threshold)?
The applicability test for Instant Asset Write-Off (annually re-set threshold) (ATO), computed across 35 industries, 9 business structures and 6 size bands.
Short answer: Some businesses
Applies when the business has small business entity.
What the obligation is
SBE asset write-off threshold reset annually; $20,000 for FY25-26.
Treasury Laws Amendment (Better Targeted Tax Concessions and Other Measures) Bill — Instant Asset Write-Off threshold $20,000 for SBEs (aggregated turnover <$10M) for FY25-26. Re-enacted annually.
The applicability test
Applies when the business has small business entity.
How the regulator frames it: Small business entities using simplified depreciation.
What triggers it: Asset acquisition + use.
Jurisdiction: Commonwealth law, so the test is the same in every state and territory.
Which industries are in or out
Outcome across the 35 industries Rules Mate maps (35 of 35: depends on size or structure).
The answer is the same in every industry: depends on size or structure. Industry does not change who must comply.
Business structure and size
Structure does not change the answer across all industries: for every structure the answer is "depends on size or structure".
| Size band | Answer across all industries, any structure |
|---|---|
| No employees (turnover $100K–$1M) | Yes |
| 1–5 employees (turnover $100K–$1M) | Yes |
| 6–19 employees (turnover $1M–$3M) | Yes |
| 20–99 employees (turnover $3M–$10M) | Yes |
| 100–499 employees (turnover $10M–$100M) | No |
| 500+ employees (turnover $100M–$1B) | No |
Worked examples
Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:
- Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: applies. Small business entity (aggregated turnover under $10M)
- Pty Ltd company in real estate agents with 100–499 employees, turnover $10M–$100M: does not apply. Requires small business entity.
- Pty Ltd company in real estate agents with 500+ employees, turnover $100M–$1B: does not apply. Requires small business entity.
What you must do, and when
- When due
- Tax return claim.
- Frequency
- Annual
- Evidence to keep
- Tax invoice + asset register + first-use evidence.
- Status
- Current
- Priority
- Medium
Penalty for not complying
No maximum penalty is recorded for this obligation in the Rules Mate corpus; check the regulator source below.
Audit or assurance level
Rules Mate has not yet classified the audit or assurance level for this obligation. Any audit, review or certification requirement is set by the regulator source listed below.
Where it sits in the corpus
Rules Mate tracks 37 published obligations tagged "tax", 6 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 7 of those apply outright. This obligation is rated medium priority, and is a annual obligation.
Regulator, legislation and tools
Regulated by Australian Taxation Office.
ATO: Federal tax administrator covering income tax, GST, PAYG, FBT, superannuation guarantee, STP, and self-managed super funds. Also administers the Director ID regime via ABRS.
ITAA 1997: Modern federal income tax statute (replaces ITAA 1936 progressively).
Free tools that help with this obligation:
Questions
- Who must comply with Instant Asset Write-Off (annually re-set threshold)?
- Applies when the business has small business entity.
- Does Instant Asset Write-Off (annually re-set threshold) apply to sole traders?
- Depends on size or structure. Across every industry and every size band, the engine's answer for a sole trader is: depends on size or structure.
- Does Instant Asset Write-Off (annually re-set threshold) apply to businesses with 1–5 employees?
- Yes (1–5 employees, turnover $100K–$1M).
- When is "Instant Asset Write-Off (annually re-set threshold)" due?
- Tax return claim.
Related
Sources
Computed by the Rules Mate applicability engine from the published obligation corpus; facts last checked 3 October 2026. Rules Mate is not a law firm and this is general information, not legal advice. Confirm your position with the regulator source or a qualified adviser before acting.