Quick answer
End of financial year brings two capital questions: how to fund tax bills, and whether to time purchases before 30 June. Businesses use lines of credit or short loans for tax, and equipment finance for assets. For 2025–26, the ATO's instant asset write-off threshold is $20,000 for eligible small businesses, based on when the asset is first used or installed ready for use. From 1 July 2026, Payday Super also changes the new year's cash flow.
Key points
- EOFY is when tax bills, purchase decisions and new-year changes collide.
- 2025–26 instant asset write-off threshold: $20,000 for eligible small businesses.
- Assets must be first used or installed ready for use by 30 June to count in that year.
- Payday Super from 1 July 2026 changes super timing from the new year.
- Financial year ends
- 30 June
- IAWO 2025–26
- $20,000 threshold
- Payday Super
- From 1 July 2026
- ATO interest
- Not deductible from 1 July 2025
Why does EOFY create capital pressure?
For many businesses, the weeks around 30 June concentrate several cash events at once:
- the last quarter’s BAS and PAYG obligations
- an income tax bill for the year just finished, due later
- super contributions to finalise for the year
- decisions on whether to bring forward purchases for tax reasons
- stock takes and year-end supplier settlements
And from 1 July 2026, a new one: Payday Super, which moves super payments much closer to each pay day. The first months of the new financial year will feel different for every employer.
Should you buy before 30 June?
The instinct to spend before EOFY to “save tax” is strong. The reality is simpler: a deduction reduces taxable income; it doesn’t hand back the purchase price. If you buy a $15,000 machine you didn’t need, you’re still down most of $15,000 after tax.
Where a purchase is genuinely needed, timing can help. For 2025–26, the ATO has confirmed a $20,000 instant asset write-off threshold for eligible small businesses. Eligible assets costing less than $20,000 that are first used or installed ready for use in the income year may be immediately deductible. The key word is used — buying on 29 June and installing in July generally moves the deduction to the next year.
Our instant asset write-off timing guide covers the planning in detail, and your accountant should confirm eligibility.
Funding equipment at EOFY
If you’re buying needed equipment around 30 June:
- Equipment finance keeps cash in the business and settles within days in most cases (general market guide)
- the supplier’s tax invoice and delivery or installation date matter for tax timing
- leave time — suppliers and installers are busy in June
Funding the tax bills
| Tax bill | Capital options |
|---|---|
| Final quarter BAS | ATO payment plan, line of credit, short unsecured loan |
| Large tax debt carried over | Property-secured loan, $20k–$250k possible same day |
| Super catch-up before Payday Super | Unsecured or property-secured, depending on size |
| Recurring tax-time squeeze | Line of credit opened ahead of June |
Since 1 July 2025, the ATO’s general interest charge is no longer tax deductible, so carrying tax debt costs more after tax than it used to. See ATO debt and BAS.
Planning the new financial year
EOFY is also the natural time to plan capital for the year ahead:
- Map the calendar — BAS dates, PAYG instalments, pay days and super under Payday Super.
- Find the dips — when does cash fall lowest? Seasonal businesses should overlay their peak and quiet months.
- Arrange facilities early — a line of credit set up in July, on a full year of statements, is easier than one set up in a crisis.
- Separate tax money — move GST, PAYG withheld and super into a separate account each pay cycle.
An illustrative example
A small engineering workshop needs a $17,500 drill press and wants it installed before 30 June. It also has a $42,000 final-quarter BAS due in July and wants a buffer ahead of Payday Super. Equipment finance funds the drill press, installed on 20 June. A line of credit, arranged in early June on strong statements, covers the BAS and sits ready for the first months under Payday Super. (Illustrative only — tax treatment confirmed with the workshop’s accountant.)
Planning ahead of June? Start the conversation early.
Common EOFY cash flow mistakes
- Spending to save tax. A deduction doesn’t refund the purchase; buy only what the business needs.
- Forgetting the July bills. The final-quarter BAS, PAYG and super arrive just after you’ve spent on EOFY purchases.
- Leaving purchases too late. Equipment that isn’t installed ready for use by 30 June generally won’t count for that year.
- Ignoring the income tax bill. A strong year means a larger tax bill later — plan for it now.
- Not reviewing PAYG instalments. If income has dropped, your accountant may be able to vary instalments to better reflect the year ahead.
A June to August cash calendar
| Period | What typically happens |
|---|---|
| June | Purchases, stock take, final pay runs of the year |
| Late June | Last chance for assets to be installed ready for use |
| July | New financial year; Payday Super timing applies to every pay run from 1 July 2026 |
| Late July | Final quarter BAS for many quarterly lodgers (check your own due date) |
| August | Annual reporting, payroll year-end finalisation |
Check exact due dates with the ATO or your tax agent — they vary with lodgement method and agent arrangements.
Talk to your accountant first
EOFY decisions blend tax and cash flow. Your accountant can tell you whether a purchase is worth bringing forward and how it affects your tax. A finance specialist can tell you how to fund it without draining the account. Doing both conversations in May rather than late June gives you room to make the right call.
Get ahead of the next 30 June
Tax time goes far more smoothly when capital is lined up before the pressure arrives. Asking what’s possible doesn’t involve a credit check. We won’t spread your enquiry across a pile of lenders — a real person looks at your calendar and calls you back. Please give us accurate figures for turnover, upcoming tax bills and any planned purchases. See if your business qualifies.
Frequently asked questions
Should I buy equipment before 30 June?
Only if the business genuinely needs it. A tax deduction reduces tax, but it doesn't refund the full cost. Talk to your accountant about whether timing the purchase makes sense for you.
What's the instant asset write-off for 2025–26?
The ATO has confirmed a $20,000 threshold for eligible small businesses for 2025–26. Eligible assets costing less than $20,000 that are first used or installed ready for use in the year may be immediately deductible.
Can I finance equipment and still claim the instant asset write-off?
Generally financing doesn't stop a claim, but the rules depend on the finance type and your situation. Confirm with your accountant.
How do I fund a large tax bill at EOFY?
Options include an ATO payment plan, a line of credit, a short unsecured loan or a property-secured loan for larger amounts. Since ATO interest is no longer deductible, compare costs carefully.
What changes for cash flow after 1 July 2026?
Payday Super begins, so super must be paid much closer to each pay day instead of quarterly, which changes the timing of cash leaving the business.