This is general information, not tax advice — the interaction between the write-off, software development pools and your specific situation is exactly what your accountant is for. But website buyers should at least know this mechanism exists, because almost no web studio mentions it and the timing changes the real cost of a build.
What changed in 2026
The instant asset write-off has spent a decade being extended one year at a time, usually announced late and legislated later, which made it useless for planning. That ended with the 2026 Federal Budget: the $20,000 threshold is now a permanent feature for small businesses (aggregated turnover under $10 million), applying per asset, so multiple eligible assets can each be written off in the year they are first used or installed ready for use.
For a website purchase, the practical effect is cash-flow timing: instead of depreciating a capital cost over several years, an eligible small business may deduct it in full in the year the site goes live. On a $6,500 build, that is the difference between a slow multi-year depreciation schedule and an immediate deduction at your marginal rate.
How the ATO treats website costs (TR 2016/3)
The ATO’s Taxation Ruling TR 2016/3 sets out how business website costs are treated, and the logic is a capital-versus-revenue split:
- Acquiring or developing a website (a new build, or a substantial redesign that changes the site’s function or structure): capital expenditure. Commercial website software is typically in-house software under the capital allowance rules — this is where the instant asset write-off can apply for eligible businesses.
- Maintaining a website (content updates, hosting, domain renewal, security patches, minor styling changes): generally deductible as a running expense in the year incurred.
- Labour and third-party costs follow the character of the work: paying a studio to build the site is part of the capital cost; paying for a monthly care plan is maintenance.
Two cautions. First, if your business has elected to use a software development pool, website development costs may need to go through the pool instead of the instant write-off. Second, "substantial upgrade versus maintenance" is a judgement call with real tax consequences — get your accountant to make it, with the project scope in front of them.
WA grants that can stack on top
Western Australia’s Small Business Development Corporation (SBDC) has run Small Business Growth Grant rounds offering matched funding of up to $10,000 for eligible WA businesses, explicitly covering advice and services in areas like digital marketing and e-commerce. Rounds open and close — the most recent opened in August and closed once allocated — so the practical move is to subscribe to SBDC updates and have a scoped quote ready when a round opens.
A matched grant plus an immediate write-off materially changes the economics of a professional build for a small WA business: a $5,000 project with $2,500 matched funding and a full first-year deduction is a very different proposition from a $5,000 sticker price.
What this means when you scope a website
Three practical implications. First, timing: if a build is going to happen anyway, completing it within the financial year you want the deduction in matters — websites are deducted when installed ready for use, not when invoiced. Second, itemisation: a quote that separates the build (capital) from the first year of care (running cost) makes your accountant’s job easier and your treatment cleaner. Our proposals are structured this way by default. Third, scope honesty: bolting a redesign onto "maintenance" to force a deduction category is exactly the kind of thing TR 2016/3 anticipates — classify the work as what it is.
Frequently asked questions
Is a new business website 100% tax deductible in Australia?
Often, for eligible small businesses: a new build is capital expenditure, and under the now-permanent $20,000 instant asset write-off an eligible business may deduct the full cost in the first year. Eligibility (turnover under $10 million), software pool elections and timing all matter — confirm with your accountant.
Are hosting, domain and maintenance fees deductible?
Generally yes, as ordinary running expenses in the year you incur them, per TR 2016/3. They are separate from the capital cost of building the site.
Does a website redesign qualify for the instant asset write-off?
A substantial redesign that changes the site’s structure or functionality is typically capital (potentially eligible); a cosmetic refresh is more likely maintenance (deductible as a running cost). The boundary is a judgement call for your accountant.
What WA grants exist for small business websites?
The SBDC’s Small Business Growth Grants have offered matched vouchers up to $10,000 covering digital and e-commerce advisory for eligible WA businesses. Rounds are periodic — check the SBDC growth page for current status.
Sources
Planning a build this financial year?
Every Fantom Labs website package sits under the $20,000 per-asset threshold, with the build and care costs itemised separately so your accountant can classify them cleanly.
Related
Published 19 July 2026 by the Fantom Labs studio team, Perth WA.