With the federal election being held on Saturday, May 3 and the end of the 2024-25 financial year fast approaching, 4×4 owners and small business operators are being encouraged to act now to take full advantage of the $20,000 Instant Asset Write-Off (IAWO) before the rules are set to change on July 1, 2025.

Currently, eligible businesses – including sole traders and small business entities with turnover under $10 million – can claim an immediate tax deduction for each business-use asset under $20,000, provided it is installed and ready for use by June 30, 2025. For tradespeople, contractors and professionals who rely on their 4x4s, this opens the door to significant tax savings on essential equipment and upgrades.

Popular claims include tool storage systems, bull bars, snorkels, UHF radios, LED lighting, suspension kits, canopies, GPS systems, and other work-related vehicle enhancements. Each item is assessed individually against the threshold, so multiple claims can be made if each item is below the $20,000 limit.

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However, the scheme’s future remains uncertain. Under current legislation, the threshold is scheduled to drop back to just $1000 from July 1, 2025. But with a federal election pending, both major political parties have made promises to support small business investment. Labor has committed to extending the $20,000 write-off for another 12 months, while the Coalition has pledged a permanent $30,000 threshold if elected. These proposals are positive but not yet confirmed, so business owners are advised to act based on the current rules.

It’s also important to understand that assets must be installed and in business use by June 30, not just ordered or paid for. With EOFY demand increasing, businesses may face stock shortages, shipping delays or workshop booking backlogs, especially for high-demand 4×4 accessories. Missing the cut-off by even a day could mean losing the instant deduction and being forced to depreciate the asset over several years instead.

For those considering a full vehicle purchase, the car limit still applies. For the 2024-25 financial year, the maximum claimable amount is capped at $69,674, regardless of the vehicle’s price. If a $78,000 ute is purchased and used 80 per cent for business, the maximum claim allowed would be 80 per cent of the $69,674 cap – not 80 per cent of the full cost.

Assets acquired under finance or leasing arrangements may still qualify for the IAWO, depending on how the agreement is structured and whether the business takes effective ownership. Business owners using these methods are strongly encouraged to seek professional tax advice to confirm eligibility.

To comply with ATO requirements and protect your deductions, maintain detailed records of all purchases, including invoices and proof of payment. You’ll also need to track the business-use percentage of your vehicle and accessories. The ATO accepts various methods, but the most reliable is maintaining a logbook over a representative 12-week period, especially if private and business use are mixed.

EOFY checklist: What to do before June 30, 2025

  • Identify business-related 4×4 accessories or upgrades under $20,000
  • Confirm that items will be delivered, installed, and in use before 30 June
  • Ensure purchases are clearly for business use—track with a logbook if needed
  • Keep all invoices, receipts, and payment confirmations
  • Review finance or lease contracts for eligibility
  • Speak with your accountant or tax advisor to confirm your claim strategy

With the election outcome uncertain and changes already legislated for July, business owners who move now can lock in substantial tax savings and future-proof their operations.

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