The $20k Write-Off Is Permanent. Are You Using It Right?
The rules have changed. If you are still treating the $20,000 instant asset write-off as a temporary, last-minute June scramble, you are leaving real money on the table.
As of 1 July 2026, the $20,000 instant asset write-off is permanent for small businesses turning over less than $10 million. Alongside it, corporate loss carry-back rules have been enshrined into law.
The annual “will-they-won’t-they” wait for Budget night is over. Yet, many mid-market business owners and finance managers continue to treat capital expenditure as a reactive tax tactic rather than a proactive growth driver.
The power of the dual strategy
Understanding how these two permanent measures interact changes your FY27 capex and cash flow strategy entirely:
- The per-asset multiplier: The $20,000 threshold applies on a per-asset basis, not as a total spending cap. You can write off multiple qualifying assets—whether that is upgrading office tech, purchasing fleet equipment, or installing new machinery—as long as each individual item sits under $20,000 GST-exclusive.
- Unlocking previous tax paid: If your planned capex or business investments push your company into a tax loss, the permanent loss carry-back rules allow you to carry those losses back against taxable income from the previous two years.
- Immediate cash refund: Instead of waiting years to offset future profits, combining the instant write-off with loss carry-back can generate a cash refund on tax you have already paid, bolstering your working capital when you need it most.
Execution requires timing
A write-off requires more than just an invoice. The asset must be delivered, installed, and ready for use within the income year. Leaving procurement until late in the financial year risks supply chain delays that can push your tax benefits into the next reporting period.
Stop viewing asset purchases through a retrospective tax lens. Strategic cash flow management demands forward-looking visibility.
How CFO On Call can help
CFO On Call works with SME owners and executive teams to build integrated tax, capex, and cash-flow models. Our fractional CFOs ensure your capital deployment aligns with your multi-year strategy while optimizing cash returns under the new tax framework.
Want to check if your capital expenditure strategy and cash-flow forecasting are set up correctly? Book a call with CFO On Call today for a comprehensive systems and cash-flow check.
