Small Business Tax Incentives: Technology Investment Boost.

The Government is consulting on exposure draft legislation to introduce a Technology Investment Boost to help small businesses operate digitally.

What is the technology investment boost?

The Technology Investment Boost allows businesses to claim an additional 20% deduction for the cost of expenses and depreciating assets.  They will be able to claim 120% of the costs as part of budget measures.  Essentially, this means that incurred costs can be deducted from taxable revenue at an amount greater than what was spent. For example, for every $1,000 you spend you will get $1,200 tax deduction.

What can be claimed?

Businesses can claim on technologies such as portable payment devices, cyber-security systems and subscriptions to cloud-based services.

How much can be claimed?

The Technology Investment Boost initiative will have an annual cap of $100,000, which means annual expenditure up to $100,000 will be eligible for the boost, with the bonus deduction capped at $20,000 per year.

How the Technology Investment Boost can be claimed?

For eligible expenditure incurred between 29 March 2022 until 30 June 2022, you can claim the expenditure as usual in your 2021-22 business tax return and the additional 20% bonus deduction for the same period in your 2022-23 tax return.

For eligible expenditure incurred from 1 July 2022 until 30 June 2023, you can deduct the entire 120% in your 2022–23 business tax return.

For more information on how you can claim the boost, please get in touch with us.