It’s almost the end of the financial year, so it’s time to think about claiming technology on tax. If you haven’t taken advantage of one of the Federal Budget incentives, it’s not too late!
It’s almost the end of the 2021-22 financial year. No, we’re not really sure where the time has gone either!
But EOFY usually means businesses are looking to make last minute tax savings and what better way than to take advantage of the recent Federal Budget incentives. All are aimed at helping small business who’ve struggled through the last few years and are now facing new post-pandemic financial difficulties, including rising interest rates and ongoing global supply issues.
Let’s take a look at three government incentives you can use to claim technology on tax.
The Instant Asset Write-Off
The Instant Asset Write-Off allows businesses to buy new or second hand assets and claim immediate tax deductions. The threshold was bumped from $30,000 to $150,000 in 2020, to combat the effects of the pandemic, and has now been extended until 30 June, 2023. The good news is you don’t have to do anything to claim, it’s simply applied to your tax return when you lodge it for that year.
Eligible businesses must have an aggregated turnover of less than $500 million and, as the business.gov websites notes:
‘Assets must:
- cost less than the instant asset write-off threshold
- be purchased and used in the year the write-off is claimed.’
Technology Investment and Skills and Training Boost
Thinking about taking your business into the digital space or upgrading your digital capabilities? Now’s the perfect time to get things moving. Both of the following incentives were announced during the Federal Budget, handed down on 29 March, 2022.
Small Business Skills and Training Boost
‘Small businesses will also have access to a new 20 percent bonus deduction for eligible external training courses for upskilling employees. The Skills and Training Boost will apply to expenditure incurred from Budget night until 30 June 2024, providing $550 million in tax relief.’
The Australian Taxation Office (ATO) shows exactly how to go about claiming technology on tax:
‘For eligible expenditure incurred between 7:30 pm AEDT 29 March 2022 until 30 June 2022:
- claim the expenditure as usual in your 2021–22 tax return, and
- claim the additional 20% bonus deduction for this 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 tax return.
For eligible expenditure incurred from 1 July 2023 until 30 June 2024:
- you can deduct the entire 120% in your 2023–24 tax return.’
This training boost is ideal if you or your employees need external training. Perhaps to bring them up to speed with any new technology you’ve introduced into the business.
Small Business Technology Investment Boost
‘The Government is providing $1.0 billion for a new Technology Investment Boost to encourage small businesses to go digital. Small businesses with annual turnover less than $50 million will be able to deduct a bonus 20 per cent of the cost of expenses and depreciating assets that support digital uptake. This includes portable payment devices, cyber security systems or subscriptions to cloud-based services. The boost will apply to eligible expenditure of up to $100,000 per year, incurred from Budget night until 30 June 2023.’
When it comes to technology tax deductions, the ATO says:
‘For eligible expenditure incurred between 7:30 pm AEDT 29 March 2022 until 30 June 2022:
- claim the expenditure as usual in your 2021–22 tax return, and
- claim the additional 20% bonus deduction for this 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 tax return.’
How the IT Agency can help adapt and transform your business
Before taking advantage of any of these incentives, we suggest you do two things. First, contact your financial team to make sure they’re right for you and your business. Then contact us. The IT Agency offers a broad range of IT and telecoms services which can be adapted to suit the needs of your business, including:
The Cloud
If you’ve not yet moved your business into ‘the cloud’, especially if you have employees working remotely, you could be missing out. Moving digital operations into the cloud offers the freedom and flexibility to quickly access programs, data, software and applications over the internet. Our pay-as-you-go service means you’ll only ever pay for what you use.
Cyber security
With more people working remotely, it’s more important than ever to protect your business from cyber-attacks or data breaches. The IT Agency holds a range of industry certifications, including the coveted CISSP (Certified Information Systems Security Professional) security accreditation. Our Security and Risk Management solutions make sure your businesses’ network, data and physical devices are secure from external attack or intrusion.
Microsoft Partner Network
As an authorised @Microsoft partner, we can help you with all things Microsoft.
Want to set up your team with some new Surface products? We can help take the guesswork out by helping you evaluate, select and buy the hardware that works best for your business and employees.
Now we’re post-pandemic, are you wanting to bring your people up to speed with all things MS Teams? We got you!
If you’re looking to claim on any of these generous technology tax deductions, we’re keen to chat and get your technology needs moving before EOFY. With remote working here to stay, great tax incentives on offer and prices only going up, now’s the perfect time to get your business digital ball rolling.
