Federal Labor has revealed it will reinstate the Instant Asset Write-off (IAWO) scheme after all.
Prime Minister Anthony Albanese, Treasurer Jim Chalmers and Small Business Minister Julie Collins jointly announced the IAWO would return for the 2025/26 financial year, if re-elected.
The scheme was not mentioned in the 2025/26 Federal Budget, causing concern among the tradie and wider small business community.
The instant asset write-off scheme allows SMEs to claim instant deductions for the cost of an asset, rather than depreciate them over time, in the year it is first used.
The write-off threshold was boosted from $1,000 to $20,000 two years ago, and applies to businesses with an annual turnover of $10 million or less. It applies on a per asset basis, so small businesses can instantly write-off multiple purchases.
Albanese said the return of the IAWO is meant to continue the push for businesses to get more tools and better equipment for their businesses.
“Because what you want to do is to encourage them to invest now,” he told ABC Radio Sydney.
“That’s the whole point, so that you create that economic activity and the multiplier that flows through immediately, rather than say, ‘oh well don’t worry, sometime in the future, forever, you can do this’.
“We want to encourage that economic activity now from small business and tradies.”