What’s New for Partnerships: 2024–25 Tax Return Updates

Partnerships should review legislative and form updates for the 2024–25 year before lodging their 2025 Partnership Tax Return. Below is a ready-to-paste summary of what’s changed.

Statement of distribution changes

System limits on the statement of distributions have been removed for online lodgment. You can now complete item 54 electronically using:

Standard business reporting (SBR) enabled software
Practitioner lodgment software (PLS)

If you’re lodging on paper and have more than three partners, photocopy pages 10–11 for each additional partner before completing.

Small business – $20,000 instant asset write-off

The $20,000 instant asset write-off is extended to the 2024–25 income year for small businesses (turnover < $10 million). Eligible entities can immediately deduct the business-use portion of each depreciating asset under $20,000, first used or installed between 1 July 2024 and 30 June 2025. The 5-year ‘lock-out’ rule is suspended until 30 June 2025.

Where to claim: Item 5 – label K Depreciation expenses & Item 50 – label A Deduction for certain assets

Debt deduction creation rules (DDCR)

From 1 July 2024, the new DDCR (subdivision 820-EAA ITAA 1997) disallows certain related-party debt deductions for multinationals, including private groups.

Who’s affected: Businesses operating in Australia and at least one other jurisdiction with related-party debt.
Exemptions: Entities (and associates) with ≤ $2 million of debt deductions; securitisation vehicles; certain SPEs; plantation forestry entities; ADIs.
Where to report: Answer “Yes” at Item 29 – label O and attach the International dealings schedule 2025.

Housing tax incentives – build-to-rent developments

From 1 January 2025, eligible large-scale build-to-rent projects can access:

4% p.a. accelerated capital works depreciation
15% concessional final withholding tax on eligible distributions

Eligibility: ≥ 50 dwellings for rent (≥ 5-year leases), ≥ 10% affordable, single owner; construction commenced after 9 May 2023; must hold incentives for ≥ 15 years or face a claw-back misuse tax.

Where to claim: Item 9 – label X Capital works deduction & label Y Build to rent capital works deduction at 4%

Changes to the Partnership Tax Return 2025

The 2025 form includes new, changed and removed labels:

New:
- Item 9 – label Y Build to rent capital works deduction at 4%
Changed:
- Item 22 – label S: “Branch operations in Australia or overseas, or direct/indirect interest in foreign trust, foreign company, CFE or transferor trust?”
- Item 29 – label O: “Were the thin capitalisation or debt deduction creation rules applicable to you?”
Removed:
- Item 52 Small business bonus deductions – label C (Small business energy incentive), label A (Small business skills and training boost)