The Australian Government has announced the following 3 measures to assist small businesses that have an aggregated annual turnover of less than $50 million:
Small businesses can now deduct an additional 20% of the expenditure incurred for the purposes of business digital operations or digitising its operations on business expenses and depreciating assets.
The boost is capped at $100,000 of expenditure per income year. You can receive a maximum bonus deduction of $20,000 per income year. The maximum bonus deduction a business can claim is $40,000 for the entire period.
To access the small business technology investment boost, your business needs to be a small business entity – aggregated annual turnover of less than $50 million in the income year the expense was incurred.
The expenditure must:
If the expenditure is on a depreciating asset, the asset must be first used or installed ready for use for a taxable purpose by 30 June 2023.
Find out if you are eligible for the Small business technology investment boost.
Small businesses will be able to deduct an additional 20% of expenditure that is incurred for the provision of eligible external training courses to their employees by registered providers in Australia.
Businesses may continue to deduct expenditure that is ineligible for the bonus deduction in accordance with the existing tax law. The special rules will apply to when the bonus deduction can be claimed in tax returns depending on a business’s balancing date.
To access the small business skills and training boost, your business needs to be a small business entity – aggregated annual turnover of less than $50 million in the income year the expense was incurred.
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Expenditure must be...
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Expenditure that can’t be claimed...
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There may be fringe benefits tax (FBT) consequences associated with the expenditure you incur. For more details, refer to Fringe benefits tax – a guide for employers.
Where the training is a component of a larger program or course of training, the enrolment or arrangement relating to the relevant expenditure must be made or entered into at or after 7:30 pm (by legal time in the ACT) on 29 March 2022.
Find out if you are eligible for the Small business skills and training boost.
While not yet law, the government has announced that the energy incentive will allow businesses to deduct an additional 20% of the expenditure incurred on eligible assets or improvements to existing assets for supporting electrification and more efficient energy use.
Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus deduction being $20,000 per business.
To access the small business technology investment boost, your business needs to be a small business entity – aggregated annual turnover of less than $50 million in the income year the expense was incurred.
The expenditure must:
Learn more about the small business energy incentive.
These boosts are not currently included in the scope of work provided by Tailored Accounts or Tailored Tax.
To claim these boosts, Tailored Tax clients are able to either:
If you’re not an existing client, feel free to contact us as well should you need any assistance with claiming your boosts.
Source: Australian Taxation Office
Compiled & Edited by Tailored Accounts
Updated 9th October 2023 to include small business energy incentive.
Please be aware that Early Stage Innovation Companies (ESIC) are required to complete an Early Stage Innovation Company report if they issue new shares to one or more investors during a financial year that could lead to an investor being entitled to access the early-stage investor tax incentives. This information must be reported to the ATO 31 days into the following financial year (which is generally 31 July).
It can be easy to fall into old habits at tax time, but just doing what you’ve always done will not help you maximise your tax deductions.
Be smarter and sharper every year so you can be sure that you’re claiming absolutely everything you’re entitled to and minimise your tax this EOFY.
Stay informed about crucial updates from the Fair Work Commission.
From wage increases to changes in parental leave and superannuation, understand how these upcoming changes will impact you before 1 July 2023.
