Tax season is upon us, and for small business owners, there is one piece of news from this year’s Federal Budget that deserves your attention. The $20,000 Instant Asset Write-Off is no longer a temporary measure that gets extended year by year, waiting on the budget with fingers crossed. As of the 2026–27 Federal Budget, it is now a permanent fixture of the Australian tax system.
That is a bigger deal than it might first appear.
A Decade of Uncertainty, Now Resolved
The Instant Asset Write-Off has been around in some form since 2015, but it has always operated on borrowed time. Each year, small business owners and their accountants had to wait to see whether the threshold would change, whether the measure would be extended, and whether the equipment they wanted to buy would actually qualify. That kind of uncertainty makes planning difficult and often delays investment decisions that would otherwise make good business sense.
What It Actually Means
From 1 July 2026, small businesses with an aggregated annual turnover under $10 million can immediately deduct the full cost of eligible assets costing less than $20,000 in the financial year they are first used or installed ready for use. Rather than depreciating the asset over several years, the full deduction hits in year one, which can have a meaningful impact on cash flow.
Think about the kinds of purchases that can typically fall under this threshold: diagnostic equipment, dispensing robots for pharmacies, point-of-sale systems, computers and tablets, specialised tools, fit-out components, and a wide range of smaller medical and business devices. Your accountant can confirm which assets in your specific situation are eligible, but for many small businesses the write-off now provides a reliable, permanent planning tool rather than something to wait on each budget cycle.
Finance and the Write-Off Can Work Together
Here is something worth discussing with your accountant. Using equipment finance to fund an asset does not necessarily mean forgoing the Instant Asset Write-Off. Depending on your circumstances, it may be possible to finance an asset and still claim the write-off in the same financial year, which could preserve your working capital while still delivering a tax benefit. Your accountant is best placed to confirm whether this applies to your situation.
What we can speak to is the finance side. A chattel mortgage or equipment loan can allow you to acquire the asset you need now and spread repayments across a term that suits your cash flow, whether the asset is $10,000 or $100,000. For assets above the $20,000 threshold, the instant write-off does not apply, though the small business simplified depreciation pool may still offer ongoing deductions. Again, your accountant can walk you through what is available for your specific circumstances.
Whether it is a new vehicle, a robotic dispensing system, upgraded clinical equipment, or a broader fit-out project, the AP Finance team can assist in finding the right lending solution across a wide panel of lenders.
A Note for Pharmacists and Medical Professionals
If you are in pharmacy or a related healthcare profession, there is an additional advantage worth knowing about. A number of lenders in our panel have what are known as auto-approval limits specifically for pharmacists and other medical professionals. These limits vary by lender and by profession, but they recognise pharmacists, GPs, dentists, and other allied health practitioners as lower-risk borrowers, given the stability and earnings profile of the profession.
In practical terms, this means that for equipment purchases up to a certain dollar value, the approval process can be significantly streamlined, with minimal documentation required and faster turnaround times. If you are looking to fund a straightforward equipment need, say a new dispensing system, consulting room upgrade, or a vehicle for the business, you may be pleasantly surprised by how simple the process can be.
The specific limits and requirements depend on the lender and the nature of the purchase, so it is always worth having a conversation with a broker who understands the healthcare lending space. This is an area where specialist knowledge genuinely makes a difference.
The Practical Takeaway
Tax season is always a good time to reflect on what your business needs and how you are going to fund it. With the Instant Asset Write-Off now locked in permanently, small business investment planning has a more reliable foundation than it has had in years. The interaction between equipment finance and the write-off is worth exploring with your accountant, as the two can often work together in ways that suit both your tax position and your cash flow.
What we can help with is the funding side of the equation, making sure you have access to the right finance, with the right structure, at the right time.
If you are thinking about your next equipment purchase or want to understand your options, get in touch with the AP Finance team. We’re here to help.
This article is general in nature and does not constitute financial, legal, or tax advice. Please consult your accountant or financial adviser before making any investment or borrowing decisions.
Written by Troy Schirmer, National Finance Manager – AP Group
AP Group are the leading pharmacy experts in Australia and specialise in helping first time buyers find the right pharmacy and secure the finance to support their purchase.
We connect existing owners with over 5000 ready and eager investors via our cutting-edge online Data Room. Our Data Room keeps confidential listing data secure and allows buyers to make informed decisions on each of our pharmacies for sale.
AP Group have built connections with all the major banks and a host of smaller lenders, ensuring that first time pharmacy buyers find a better deal.
About the Author:
Troy brings more than a decade of experience in banking and lending, having spent 11.5 years with NAB, including eight years as a Banker within NAB Health. He has supported clients across Victoria and nationally, helping finance the purchase of a wide range of businesses, from pharmacies and medical clinics to childcare centres and other commercial assets.
Highly experienced across business lending, home lending, and asset finance, Troy holds a Bachelor of Commerce with majors in Accounting and Finance, along with a Diploma of Financial Planning. He is known for his practical approach and ability to navigate complex lending structures with clarity and confidence.
Outside of work, Troy enjoys spending time with his family, travelling, watching just about any sport, and is a proud Essendon tragic – regardless of the score.