Two Wins for Small Business: Permanent Write-Off, Loss Carry-Back
On 19 August 2026, the Senate passed the Treasury Laws Amendment (Tax Reform No. 2) Bill 2026, locking in 2 tax measures that are beneficial for Australian small businesses.
The $20,000 Write-Off To Be Made Permanent
For the past few years, the instant asset write-off has been extended on a year-by-year basis, usually announced in the Budget and then not law until close to (or sometimes after) the financial year it applied to. It was difficult to plan with confidence for property, plant & equipment purchases.
That uncertainty is set to end. From 1 July 2026, the $20,000 instant asset write-off will be a permanent feature of the tax law (the Bill has passed both Houses and is awaiting Royal Assent as at 21.08.2026).
A Loss Carry-back Scheme is Also Back
The same legislation introduces a loss carry-back scheme for companies, allowing eligible businesses to apply a tax loss against tax paid in either of the previous 2 income years and receive a refundable offset.
A few key points:
It applies to revenue losses only — not capital losses.
Eligible companies must have aggregated annual turnover of less than $1 billion.
The refundable offset is the lesser of:
the amount of tax the company paid in the earlier income year(s) being carried back to, and
the company's franking account balance at the end of the income year the offset is claimed in.
What should you do?
Both measures apply from 1 July 2026, so they're relevant for planning purchases and reviewing your position for the current financial year onwards. If you're weighing up capital purchases or your business has moved into a loss position after a profitable run, it's worth having a conversation about how these changes affect your specific situation.
Get in touch if you'd like to talk through how the permanent write-off or the loss carry-back scheme could apply to your business
