Key Takeaways
- A hard deadline applies: The $20,000 instant asset write-off runs only to 30 June 2026, then drops to $1,000, so the timing of a purchase changes its tax treatment.
- Installed, not just ordered: To claim the write-off, the asset must be first used or installed ready for use by 30 June, not merely paid for or on order.
- Per asset, under $10M turnover: The $20,000 limit applies to each asset separately, for businesses with aggregated turnover under $10 million.
- Bigger items pool instead: Assets of $20,000 or more go into the small business pool, depreciating at 15% the first year and 30% after.
- Lead times can beat you: A device ordered too late to be installed by 30 June misses the deduction, so timing the order matters as much as the decision to buy.
For medical practices, the end of the financial year is more than an accounting formality. In 2026 it carries a specific deadline that changes how much a piece of equipment effectively costs, depending on when you buy and install it. Understanding how the end of financial year (EOFY) affects purchase timing can be the difference between claiming a full deduction this year and spreading it over several. This guide explains the rules as they stand for 2025-26, how they shape the timing of a medical equipment purchase, and where the traps lie.
The rule that drives EOFY timing in 2026
The central mechanism is the instant asset write-off. It lets an eligible small business immediately deduct the full cost of a qualifying depreciating asset in the year it is first used or installed ready for use, instead of depreciating it over several years. For the 2025-26 financial year the threshold is $20,000 per asset, and this has been passed into law. On 1 July 2026 the threshold is set to return to $1,000 unless extended again.
That scheduled drop is what makes EOFY 2026 a genuine timing decision. A qualifying asset installed by 30 June can be written off in full; the same asset installed a few days later, in the new financial year, would face a far lower threshold and, if over $1,000, would be depreciated through the pool instead. For planned purchases, the calendar changes the tax outcome.
Who and what qualifies
The write-off is not universal, so check your position against the conditions before you rely on it:
- Turnover: Your business needs an aggregated annual turnover of less than $10 million to use the instant asset write-off.
- Per-asset limit: The $20,000 applies to each asset, not as a total, so several qualifying items each under the limit can each be written off.
- GST treatment: If you are registered for GST, test the cost against the GST-exclusive price; if not, use the GST-inclusive cost.
- New or used: Both new and second-hand assets can qualify, provided they meet the conditions and are used for business.
- Business use: Only the business-use portion is deductible, and the entire cost of the asset must still be under the limit.
Assets costing $20,000 or more do not miss out entirely; they go into the small business pool and are depreciated at 15% in the first year and 30% each year after. Higher-value medical equipment such as an ultrasound machine will typically fall into this category rather than the immediate write-off.
Why "installed ready for use" is the timing trap
The most common EOFY mistake is assuming that ordering or paying for equipment before 30 June is enough. It is not. The asset must be first used or installed ready for use by 30 June to be claimed in that year. For medical equipment, that distinction bites, because clinical devices often need delivery, installation, calibration, and commissioning before they are genuinely ready for use.
A practice that orders a device in mid-June may find it does not arrive and commission until July, pushing the deduction into a year with a $1,000 threshold. The practical implication is that the order has to be placed early enough to allow for delivery and setup within the financial year. Timing the purchase decision is only half the job; timing the order against the supplier's lead time is the other half.
How this shapes purchase timing
Put together, the rules point to a clear timing logic for 2026, without ever justifying buying equipment you do not need:
| Situation | Timing implication |
|---|---|
| Planned item under $20,000 | Install by 30 June 2026 to write off in full |
| Long-lead item under $20,000 | Order early so it is installed before the deadline |
| Item $20,000 or more | Pools and depreciates; deadline pressure is lower |
| No genuine need | Tax alone is not a reason to buy |
The disciplined approach is to identify equipment you were going to buy anyway, then decide whether installing it before 30 June improves the tax outcome enough to bring it forward. The write-off reduces taxable income, but it never returns more than the asset costs, so it should sharpen the timing of genuine purchases rather than manufacture new ones.
A realistic scenario
Picture a physiotherapy clinic that has budgeted for two new electric treatment plinths, each around $6,000, and has been meaning to replace them for months. In May, the owner realises the write-off threshold drops on 1 July.
Because each plinth is under $20,000 and the clinic turns over well below $10 million, both can be written off in full this year, provided they are delivered and installed before 30 June. The owner places the order in early June to allow for lead time, confirms with the accountant that the clinic qualifies, and has the plinths commissioned with a fortnight to spare. Had the same clinic wanted a $40,000 ultrasound machine, the deadline would matter far less, because that asset pools and depreciates regardless. The lesson is to match the timing effort to the asset value and to genuine need. Clinics can compare options through the examination table and ultrasound table and couch categories, and the ultrasound machine prices guide helps frame where an item sits against the threshold.
Frequently asked questions
What is the instant asset write-off threshold for 2025-26?
For the 2025-26 financial year the threshold is $20,000 per asset, for businesses with aggregated turnover under $10 million. It applies per asset, so multiple qualifying items each under $20,000 can each be written off. On 1 July 2026 the threshold is set to drop to $1,000 unless extended.
Does the equipment need to be installed by 30 June?
Yes. To claim the write-off in 2025-26, the asset must be first used or installed ready for use by 30 June 2026, not merely ordered or paid for. For medical devices needing delivery, installation, and commissioning, order early enough that setup finishes before the deadline.
Can I write off an expensive item like an ultrasound machine?
Not under the instant asset write-off if it costs $20,000 or more. Such assets go into the small business pool and are depreciated at 15% in the first year and 30% after. The EOFY deadline pressure is therefore lower for higher-value equipment than for items under the threshold.
Does buying before EOFY always save money?
No. A deduction lowers taxable income but never returns more than the asset costs, so buying equipment you do not need is not a saving. The write-off is a reason to time genuinely planned purchases well, not a reason to spend. Confirm your situation with your accountant.
Do second-hand devices qualify for the write-off?
Yes, both new and second-hand assets can qualify, provided they meet the eligibility conditions, cost under $20,000, and are installed ready for business use by 30 June 2026. This can make refurbished medical equipment an attractive option within the window, subject to the usual checks on condition and warranty.
What matters most
In 2026, EOFY affects medical equipment timing because a real deadline sits on 30 June: the $20,000 instant asset write-off falls to $1,000 the next day. For items under the threshold that you genuinely need, install them before the deadline to claim the full deduction, and order early enough that delivery and commissioning finish in time. For higher-value equipment that pools regardless, the deadline matters far less. Above all, let genuine clinical need drive the purchase and let EOFY drive only the timing, confirming your eligibility with your accountant before you rely on the deduction.
Timing an equipment purchase before 30 June? Compare quotes from medical equipment suppliers across Australia here.
