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Tradies to permanently keep $20k tax break

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Tradies to permanently keep $20k tax break

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A popular one tax break will become a permanent feature, allowing small businesses and tradies to continue claiming tax deductions on equipment worth up to $20,000.
Treasurer Jim Chalmers will ensure that the immediate write-off of wealth taxes becomes permanent for small businesses, as will a shift to ‘dynamic monthly tax payments’ a week after the May budget.
The tax break would run until June 30 before the threshold would drop from $20,000 back to $1,000. However, according to the new plan, the arrangement will remain in force, which provides major relief for small businesses and traditions.
Treasurer Jim Chalmers
Treasurer Dr Jim Chalmers during a press conference at Parliament House in Canberra on Tuesday, May 5, 2026. fedpol Photo: Alex Ellinghausen (Alex Ellinghausen)

The $20,000 threshold is per asset and applies to tools, technology and other equipment, both new and used, and can be claimed in full at the end of each financial year.

Treasurer Jim Chalmers said improving productivity is “one of the most important parts” of Tuesday’s budget.

“We will save small businesses thousands of dollars by making the instant asset permanent in the budget on Tuesday,” he said.

“This means small businesses can immediately deduct any new equipment worth up to $20,000, from new technology to tools and machinery.

“This will help small businesses save 376,000 hours per year in compliance, reducing red tape and driving down costs in our economy.”

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