You generally can’t deduct spending on capital assets immediately; instead you claim the cost over time, reflecting the asset’s depreciation (or decline in value). This applies to any taxpayer who uses depreciating assets to earn assessable income, including:
- businesses, small and large
- rental property investors
- employees (for equipment and tools they provide at their own expense for use in their work).
- items costing up to $100 used to earn business income (but note the higher immediate write-off limit for small businesses mentioned above)
- items costing up to $300 used to earn income other than from a business (such as employee-provided tools and equipment)