Coco Hou, CPA: Businesses missing out on $20,000 Instant Asset Write-Off opportunity

Announcement posted by Invigorate PR 24 Jan 2025

Coco Hou CPA and CEO of Platinum Accounting Australia, is calling on small businesses across the nation to act now and take advantage of the Australian Government's $20,000 instant asset write-off. Despite the opportunity to improve cash flow and reduce compliance costs, many businesses are failing to access this vital support because they are not aware of it.

"The $20,000 instant asset write-off is a golden opportunity for small businesses to upgrade equipment, invest in growth and improve operations without the usual tax-time headaches," Hou said.

"Unfortunately, too many small business owners are unaware of the benefits or are simply not making the most of it. I am spending a lot of time with business owners ensuring that they are aware of these ATO initiatives so they can benefit from them before 30 June hits.

"We know a lot of businesses are struggling at the moment due to the COVID hangover and other economic challenges. Taking advantage of schemes like this can help businesses weather difficult times and achieve much needed growth."

Key details about the Instant Asset Write-Off

The instant asset write-off threshold was increased from $1,000 to $20,000 for the 2023-24 year. On 14 May 2024, as part of the 2024-25 Budget, the government announced it will continue to improve cash flow and reduce compliance costs for small businesses by extending the $20,000 instant asset write-off by a further 12 months until 30 June 2025. The policy offers immediate tax relief to eligible businesses:

Eligibility: Small businesses with an aggregated turnover of less than $10 million.
Deduction amount: Businesses can instantly deduct the full cost of eligible assets costing less than $20,000.
Timeframe: The asset must be first used or installed ready for use between 1 July 2023 and 30 June 2025.
Multiple assets: The $20,000 threshold applies on a per-asset basis, enabling businesses to claim deductions for multiple eligible assets.
Simplified depreciation pool: Assets valued at $20,000 or more can still be placed into the simplified depreciation pool and depreciated over time. Pool balances under $20,000 at the end of 2023-24 can also be written off.

"The business community has welcomed the government's proposal to extend the write off for a further 12 months until 30 June 2025," Hou said.

"This means businesses need to act to ensure they benefit from the extension."

According to Hou, the primary reasons businesses fail to leverage the instant asset write-off include:

Lack of awareness: Many small businesses are simply unaware of the temporary increase in the threshold.
Misunderstanding eligibility: Confusion about what assets qualify and the claim process is holding businesses back.
Procrastination: Some businesses delay investing in assets, missing critical windows for tax benefits.

"This initiative is designed to stimulate business growth and improve cash flow, but the benefits can only be realised if businesses take action before the deadline," Hou said.

"Don't let this chance slip away. Invest in your business now and reap the rewards of improved operations and reduced tax obligations. Talk to your accountant to ensure you are across all of the incentives and write-offs available as there are many and you may find that your business is eligible for other benefits as well. They are important as they help bring more money into the business."

About Platinum Accounting Australia

Platinum Accounting Australia is a leading national accounting firm that has been operating in Australia since 2008. With a national footprint, the business offers a broad range of services for individuals and businesses of all sizes including tax planning, accounting, advisory and bookkeeping. Platinum Accounting Australia also offers a highly popular and growing licensee program for bookkeepers and accountants to assist them to grow as part of a respected national network.