The Australian Government extended the $20,000 instant asset write-off for the 2025–26 financial year through the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Act 2025, which passed Parliament in November 2025. This is the law as it stands today — confirmed, legislated, and in effect.
Here's the critical part: from 1 July 2026, the threshold reverts to just $1,000 unless the government legislates a further extension. That's a 95% reduction. Industry groups including the Council of Small Business Organisations Australia (COSBOA) have called for the threshold to be made permanent, but the government has made no commitment to extending it again. Businesses should plan on the assumption that this is the last year at $20,000.
If you've been considering a new exhaust canopy, fan upgrade, or kitchen ventilation improvements, the next three months are the window to act. Equipment must be installed and ready for use by 30 June 2026 to qualify for this financial year's deduction — ordering before June 30 is not enough.
The instant asset write-off allows eligible small businesses to claim the full cost of qualifying assets as an immediate tax deduction in the year of purchase, rather than depreciating them over several years. For a café owner buying a $3,500 exhaust canopy, that's a $3,500 deduction this financial year — not $525 per year spread across seven years of depreciation.
Your business qualifies if it meets these conditions:
The write-off applies on a per asset basis, meaning each individual item under $20,000 can be fully deducted. For a typical commercial kitchen ventilation project, that means every component can potentially be claimed separately:
Both new and second-hand assets qualify, as long as they meet the cost and usage requirements.
This is where planning matters most. The ATO requires that the asset be first used or installed ready for use for a taxable purpose by 30 June 2026. Simply purchasing or ordering an item before the deadline doesn't count. If you order a canopy on 20 June and it's delivered on 5 July, you cannot claim the deduction for 2025–26.
Allow adequate lead time for manufacturing, delivery, and installation when planning your purchase.
One of the most common questions we get is "how much does a commercial kitchen canopy actually cost?" Pricing transparency is rare in this industry, but at NXT GEN Canopies we publish our prices because we believe informed customers make better decisions.
| Product | Price range (ex-GST) | IAWO eligible? |
|---|---|---|
| Standard exhaust canopies | $1,705 – $4,675 | Yes — all under $20,000 |
| Vertical discharge fans | $825 – $2,200 | Yes — all under $20,000 |
| VSD controllers | From ~$400 | Yes |
| LED canopy lights | $110 – $132 each | Yes |
| Honeycomb grease filters | Available in shop | Yes |
Every canopy, fan, and accessory in the NXT GEN shop falls well under the $20,000 threshold. This means a typical installation with a canopy, fan, VSD controller, and LED lighting can be claimed as multiple separate assets — each fully deductible this financial year.
A complete ventilation system (canopy + exhaust fan + ductwork + make-up air + installation) varies by kitchen size and complexity. Here's a general guide:
| Kitchen type | Typical system scope | Approximate range |
|---|---|---|
| Small café (1–2 appliances) | Wall canopy + fan + basic ductwork | $3,500 – $6,000 |
| Medium restaurant | Larger canopy + fan + VSD + ducting | $6,000 – $12,000 |
| Large commercial kitchen | Multiple canopies + fans + complex ducting | $12,000 – $25,000+ |
| Food truck | Tapered hood + compact fan | $2,500 – $5,000 |
For larger projects exceeding $20,000 total, remember the threshold applies per asset. A $15,000 canopy and a $1,800 fan are two separate assets — both can be individually claimed.
The EOFY deadline creates urgency, but there are several other reasons why now is a particularly good time to invest in kitchen ventilation.
AS 1668.2 was updated in November 2024 with significant changes to commercial kitchen ventilation requirements. New installations should be designed to the current edition. If you're upgrading from an older system, building to the 2024 standard future-proofs your investment. We've written a detailed guide on what changed in AS 1668.2:2024 and how it affects Victorian kitchens.
Modern exhaust systems with VSD controllers adjust fan speed based on actual cooking demand, rather than running at full speed all day. This can substantially reduce electricity costs — particularly relevant with energy prices where they are. NCC Part J6 now requires variable speed control for systems exceeding 1,000 L/s, so upgrading to a compliant system addresses both energy costs and regulatory requirements.
Kitchen conditions directly affect chef retention. A properly ventilated kitchen that controls heat, smoke, and grease makes the workplace safer and more comfortable. In a hospitality sector where skilled staff are hard to find, investing in the physical environment is a practical retention strategy.
Melbourne's food scene continues to diversify. Ghost kitchens, food trucks, school canteens, and aged care facilities all have specific ventilation requirements. If you're entering or expanding in any of these sectors, getting the right exhaust system installed while the write-off is available makes commercial sense.
With roughly three months until 30 June 2026, timing is everything. Here's how to plan backwards from the deadline.
| Stage | Typical timeframe | What happens |
|---|---|---|
| Quote and site assessment | 1–3 days | We assess your kitchen, confirm canopy size, fan requirements, and duct route |
| Design and approval | 3–5 days | Final specification, building surveyor documentation if needed |
| Manufacturing | 5–10 business days | Custom canopy built at our Coburg North workshop |
| Delivery and installation | 1–3 days | On-site installation, commissioning, airflow balancing |
Total: approximately 2–4 weeks from quote to installation.
To guarantee your system is installed and operational by 30 June 2026, we recommend contacting us no later than late May — and earlier if your project involves complex ductwork, council approvals, or heritage overlay considerations.
Keep these documents for your accountant:
Your accountant will use the simplified depreciation rules to claim the immediate deduction. If you're unsure whether your business currently uses simplified depreciation, check with them before making a purchase — it needs to be elected in your tax return.
This article provides general information about the $20,000 instant asset write-off based on publicly available ATO guidance and the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Act 2025. It is not financial or tax advice. Every business situation is different — speak with your accountant or tax adviser to confirm your eligibility, assess the tax impact for your specific circumstances, and ensure your purchases are structured correctly. NXT GEN Canopies is a commercial kitchen ventilation business, not a financial advisory firm.
For the latest official guidance, visit the ATO's instant asset write-off page.
We'll provide a detailed quote showing each asset itemised separately — so your accountant can claim each item individually under the instant asset write-off. We'll also confirm an installation timeline to make sure everything is operational before 30 June.
Get your EOFY quote before the June 30 deadline
Or browse our canopy shop for standard sizes available for quick-order with published pricing.
Yes. Commercial exhaust canopies are eligible depreciating assets. Under the instant asset write-off for 2025–26, canopies costing less than $20,000 (ex-GST for GST-registered businesses) can be fully deducted in the year they are installed and ready for use. All NXT GEN canopies fall within this threshold.
The limit is $20,000 per asset for the 2025–26 financial year (1 July 2025 to 30 June 2026). This applies to businesses with aggregated annual turnover under $10 million. From 1 July 2026, the threshold is legislated to drop to $1,000 unless the government extends it again.
Yes. The ATO requires that the asset is first used or installed ready for use for a taxable purpose by 30 June 2026. Simply placing an order or making payment before the deadline is not sufficient — the equipment must be physically installed and operational.
Yes. The $20,000 threshold applies per asset, not per project. A canopy, exhaust fan, VSD controller, and LED lights purchased as part of the same installation are separate assets, each eligible for individual write-off as long as each item costs less than $20,000.
That's fine — it's the per-asset cost that matters. If your project includes a $4,000 canopy, a $1,800 fan, a $400 VSD controller, and $250 in LED lights, each item is individually under the threshold and can be fully deducted. Only individual items costing $20,000 or more need to be depreciated through the small business pool.
As of March 2026, the government has made no commitment to extend the $20,000 threshold beyond 30 June 2026. The ongoing legislated threshold remains $1,000. Industry groups have called for a permanent increase, but businesses should plan on the assumption that the current extension is the last.
