“Installed ready for use” by 30 June: the test that decides your deduction year

A surprising number of EOFY plans come unstuck on four words: “installed ready for use”. The equipment is ordered, paid for, even delivered — but because it isn’t set up and able to work by 30 June, the deduction slides into the next financial year. Here’s how the test works in practice and how to plan around it.

What does the ATO actually require?

The ATO describes eligible assets as those “first used or installed ready for use” for a taxable purpose within the relevant period. For 2025–26, that period ran from 1 July 2025 to 30 June 2026. From 1 July 2026, the $20,000 threshold is permanent, but each financial year still ends on 30 June.

So there are two ways to meet the test by 30 June:

• First used: the asset has actually been used in the business; or
• Installed ready for use: it’s in place and able to be used for its purpose, even if no job has been done with it yet.

What doesn’t meet the test: paying a deposit, receiving an invoice, or having the item in a warehouse, in transit or in its crate awaiting connection.

Where do the delays usually come from?

Almost never from the purchase itself. The hold-ups sit between delivery and “ready”:

Stage	Typical hold-up
Stock	Popular models sold out in May and June
Freight	Shipping delays on imported gear
Site prep	Concrete pads, benches, extraction, three-phase power
Trades	Electricians, plumbers and gasfitters booked out
Commissioning	Manufacturer technician visits, calibration, software licences
Compliance	Inspections or certification before use

If your equipment needs any of the items in the bottom four rows, add weeks, not days, to your plan. Our page on supplier lead times looks at the freight side.

How do I protect the deduction year?

Plan the job backwards from 30 June, allowing a buffer for each dependency:

1. Confirm stock and delivery date in writing before paying.
2. Book site preparation and trades at the same time as the order.
3. Ask the supplier who commissions the equipment and when.
4. Arrange finance early so payment doesn’t hold up dispatch.
5. Keep dated evidence: delivery docket, installation sign-off, photos, first use record.

The finance step is often the one owners leave last, and it’s the one that can quietly hold everything else up. If the supplier won’t release stock until paid, a late approval pushes delivery and installation into July. Starting that conversation early — a quick enquiry takes about a minute — keeps the critical path clear.

Illustrative example: the bakery oven

Illustrative only — invented dates and figures.

A bakery orders a deck oven on 20 May for $19,400 (excluding GST). The supplier promises delivery on 16 June. The oven needs a gas fitter to connect it and a manufacturer’s technician to commission it.

• Scenario A: gas fitter booked for 18 June, technician for 20 June. The oven is installed ready for use on 20 June. The deduction falls in the current year.
• Scenario B: the owner books the gas fitter after delivery; the earliest slot is 4 July. The oven sits in the bakery, uninstalled, on 30 June. The deduction falls in the next year.

Same oven, same price, same delivery date. The only difference was booking the trades early.

Does it matter which year I get the deduction?

Sometimes a lot, sometimes not much. If this year’s profit is unusually high, bringing a deduction into this year can reduce this year’s bill. If next year looks stronger, a July installation may even suit you. It’s a conversation for your accountant. What matters from a planning point of view is that you choose the year, rather than having a gas fitter’s diary choose it for you. The decision guide buy in June or July? goes through the trade-offs.

Is the permanent threshold a reason to relax?

Partly. With the $20,000 threshold now permanent, there’s no risk of the limit falling after 30 June, so a July installation doesn’t mean losing the write-off — only deferring it. That takes some heat out of June. But deferring a deduction by a year can still affect cash flow, particularly for companies paying tax at the 25% base rate entity rate on a strong year. More on the rules in instant asset write-off 2026.

What if the installation date is at risk?

If you’re in June and the date looks shaky, you have a few options:

• Escalate early. Tell the supplier and installer the 30 June date matters and ask what would bring it forward.
• Split the job. If several items are involved, prioritise installing the ones that can be ready.
• Check what counts as ready. Some equipment is genuinely ready for use once positioned and connected, even if optional extras come later. Your accountant can advise on your specific item.
• Accept the next year. With the permanent $20,000 threshold, a July installation defers the deduction rather than losing it.

What you shouldn’t do is record an asset as ready when it isn’t. The paperwork trail — delivery docket, installation sign-off, first job record — needs to match reality.

Don’t let a diary decide your tax year

If you’re planning to have equipment working before 30 June, start with the part that holds everything else up: the funding. Our enquiry form takes about a minute and doesn’t involve a credit check. We don’t circulate your details to a line of lenders — one specialist picks it up and calls you. Tell us accurately what you’re buying, the price and your target install date so we can work to your timeline.