For a plumber the tools are the fattest deduction on the return, and also the one most people muddle. Stillsons, a set of dies, a press tool, an electric eel, the drain camera you feed down a blocked stack: you bought the lot because the trade demands it, so the spend is yours to claim. Whether a tool qualifies is rarely the sticking point. How you claim it is, and that hangs entirely on one figure. Nail the $300 line and every other rule on this page falls in behind it.
The $300 line
What a tool cost you decides how you claim it, and that split is the engine under everything below.
The whole cost comes off the year you buy it. A pipe wrench, a level, a blowtorch, a sub-$300 cordless drill: each is a clean deduction straight away.
You spread the claim over the tool's effective life as it declines in value. The press tool, the drain camera and the pipe locator belong here. Pick prime cost or diminishing value and keep to it for that tool.
Two adjustments matter: private use and part-year ownership. If a tool sometimes does jobs at your own house, only the work slice is claimable, and a tool bought mid-year is counted only for the days you owned it. Plumbers tend to slip up in opposite directions, writing off a costly press kit all at once when it should be spread, then leaving a $460 set of dies off entirely on the belief it can't be claimed if it won't come off in one year. It can, just across a few of them.
The set trap and the replacement out
This is the rule that trips up plumbers more than any other, because it closes off the workaround everyone reaches for. Splitting a pricey kit into cheap individual buys will not slip you under the $300 line.
A $350 ratchet set clears the line as a set, so no immediate write-off, even though not a single socket in the box cost anywhere near $300.
When a set, or a run of identical or near-identical items you begin holding in the same year, tops $300 all up, it has to be depreciated no matter how little each piece cost. The ATO uses exactly that example, and it reaches a boxed run of pipe dies or a matched set of press jaws bought together. A later replacement plays by different rules: if one die gives out and you buy a single one to replace it down the track for $300 or less, that piece isn't part of a set bought that year, so it's fully deductible in the year of purchase.
Depreciation keeps running
A tool over $300 doesn't just show up on one return and vanish. Every year until it's written down to zero you claim that year's portion of its decline in value, and this is the slice plumbers forget once the purchase sits a couple of returns back. The drain camera from two years ago still holds value worth claiming, so bring it onto this year's return, not only the one where you paid. The figure flows from the tool's remaining value and its effective life, and the ATO's own depreciation tool does the arithmetic.
Repairs, insurance and hire
The $300 line is about buying a tool. It says nothing about keeping one going, covering it or renting one, and each of those is a deduction on its own terms.
The write-off that isn't yours
Every online listicle for tradies waves the instant asset write-off around like a shortcut. For a plumber on wages it is the wrong door, because that rule was written for someone else.
That write-off lets a small business deduct assets straight away up to a cap the ATO sets, and it turns on the business's turnover. It sits with ABN holders, not with employees. On a PAYG wage your rule is the one on this page and no other: immediate at $300 or under, depreciate above it. The cap doing the rounds online has nothing to do with you. And if you can't say for certain whether you're an employee or a subbie on an ABN, that single fact reshapes what deductible means across the board, tools included.
The tool allowance catch
See a tool allowance on your payslip and it feels like the tool question is already settled. The opposite is true: that allowance is taxable income in its own right, and what you spent on tools is claimed on top of it.
The records behind a tool claim
Each tool above rests on the receipt behind it, and a tool-heavy return is where the paperwork tends to spring a leak.
- A receipt for every tool, showing date, supplier, item and cost, held for five years.
- A note of the work-use split on anything that also does jobs at home, since that split draws the first question.
- Records across the board once your total work-related claims clear $300 for the year, not just the expensive gear.
The bottom line
Sort each tool by its cost. Under $300 comes off this year, over $300 spreads across its life, and a set is weighed as one lot however cheap the pieces. Keep drawing down last year's tools until they're fully written off, add the servicing, the dedicated tool cover and the hire, and hand the instant asset write-off back to the businesses it was made for. Treat a tool allowance as income and claim your genuine spend against it. Back the lot with receipts and your tool bill sits on the return exactly where it should.
See what your tools, insurance and other work claims come to at tax time.
General information only, not tax advice. Check the ATO or a registered tax agent for your situation.