As part of the 2022-23 Budget, the government announced it would support small businesses through the technology investment boost and skills and training boost, which are now law as of the 23rd of June 2023. Expenses incurred between 7:30 pm AEDT on the 29th of March, 2022 and the 30th of June 2024, will be covered by this provision.
Small businesses, with an annual turnover of less than $50 million are now eligible for an additional 20% deduction on expenses related to enhancing digital operations or digitising their business processes. This deduction extends to depreciating assets such as portable payment devices, cybersecurity systems, and subscriptions to cloud-based services.
Each qualifying income year is subject to a cap of $100,000 in expenditure. Expenditure surpassing this cap can still be deducted under pre-existing regulations.
This provision applies to expenses incurred between 7:30 pm AEDT on the 29th of March 2022 and the 30th of June 2023. For a depreciating asset to be eligible, they must have been first utilised or installed by the 30th of June 2023. Specific regulations govern the timing of claiming the bonus deduction in tax returns, contingent on a business’s balancing date.
Additionally, small businesses (with an annual turnover of less than $50 million) can deduct an additional 20% of the expenses incurred in providing eligible external training courses for their employees, as long as these courses are offered by registered providers within Australia. Expenditure that doesn’t qualify for the bonus deduction can still be deducted according to the prevailing tax laws.
Similar to the technology investment boost, the timing of claiming the bonus deduction in tax returns is influenced by a business’s balancing date, subject to specific rules.
Do you need assistance with claiming these deductions? Contact our Walker Hill Accounting team today! support@walkerhill.com.au.
