Eligible small businesses are now able to make a tax deduction of $120 for every $100 they spend on tech upgrades and digital skills training as the Government starts a new push for firms to embrace digital technology.
Some smart options include Digital Marketing to help you get more customers, Customer Service skills so your existing staff can help customers while they are at your website and Online Accounting software so your staff can perform their work from anywhere.
The Government says it is part of their $1.6 billion tax relief package for small businesses to go digital and upskill their employees.
The Government has called it their Technology Investment Boost and applies to:
- Businesses with turnover of less than $50m per annum.
- Items such as portable payment devices, cyber security systems and subscriptions to cloud-based services.
- Deductions for the cost of expenses and depreciating assets of up to $100,000 of expenditure per year.
- Expenditure incurred from 7:30pm (AEDT) on 29 March 2022 (Budget night) until 30 June 2023.
It is clear that the Government sees the use of digital technology in commerce and the workplace as having such enormous business benefits that they will bring about economic growth and stimulus; most likely through improved productivity and creation of new markets.
New Technology: The Pollies Get On It
In a statement from the Office of the Prime Minister, the Government said “Building on previous small business investment incentives, including the ability to instantly write‑off assets, which is in place until 30 June 2023, the 2022-23 Budget includes a comprehensive package of measures to support small businesses to grow, innovate and create more jobs”
While in his budget speech, the treasurer, Josh Frydenberg said he hoped the technology scheme would assist small businesses “that are embracing the digital revolution” to further invest in new technologies.
“From tonight, every hundred dollars these small businesses spend on digital technologies like cloud computing, e-invoicing, cybersecurity and web design will see them get a $120 tax deduction,” Frydenberg said.
Skills and Training Boost
Also part of the package is The Skills and Training Boost will also cover spending incurred by eligible businesses from Tuesday, until 30 June 2024.
Under this scheme, small businesses will be able to claim a bonus 20 per cent deduction for the cost of external training courses delivered to employees in Australia or online, by providers registered in Australia.
The Technology Investment Boost is expected to cost $1bn, while the Skills and Training Boost will cost around $550m.
Three Ways Embracing New Technology Can Boost Your Business
- Improve Productivity: New technology can take over monotonous tasks, makes communication, quicker and easier, streamline tasks, create automatic records, reduce paperwork and facilitates continuous education.
- Better Customer Service: Technology can allow you to use virtual assistants and chatbots meaning you be online for new and existing customers 24/7. Technology also allows you to keep records of conversations between customers and employees to see where communication may have broken down.
- Enhanced Business Security: With a growing number of digital threats, you need to understand new technology to keep your business safe.
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