Effective March 29th 2022, from 7.30pm, small businesses with an annual turnover of less than $50 million, will be able to claim 120% of the costs spent on new technologies and training courses to upskill staff.
In an effort to support small businesses "improve their digital capability and see staff become more productive and competitive," the Federal Budget 2022 outlined measures that will cost the government $1.6 billion in tax revenue.
For an estimated 3.6 million businesses, eligible costs incurred from Tuesday evening can be deducted from their taxable revenue at an amount greater than what was actually spent.
Technology Investment Boost
Designed to encourage small businesses to upgrade their digital capabilities and invest in new technologies, the Technology Investment Boost allows businesses to claim "a bonus 20% deduction for the cost of expenses and depreciating assets, such as portable payment devices, cyber security systems, and subscriptions to cloud-based services."
Key points to note:
- Applicable to businesses with an annual turnover less than $50 million
- Effective from March 29th 2022, 7.30pm - June 30th 2023
- Technology expenditure up to $100,000 per year
- $120 tax deduction per $100 spent
- Including technologies such as: Cloud Computing, e-Invoicing, Cyber Security, and Web Design
While the effect of the lock down over the past two years saw a number of organisations strive to implement and improve digital technologies, particularly when forced to work remotely, many are yet to embrace the full potential technology can unlock for them.
A 2020 Venture Insights report found 39% of SMEs are failing to grasp the opportunities offered by new technologies, and 31% are struggling to keep up with technological changes critical to their success.
Cyber Security
Along with the governments support of $1 billion, to help small businesses economic recovery through technology investment, they have also announced an overall investment of nearly $10 billion to increase Australia's intelligence and cyber security capabilities over the next 10 years, with major a commitment to the Government’s Project REDSPICE.
Resilience, Effects, Defence, Space, Intelligence, Cyber and Enablers, REDSPICE is the government’s response to increasing threats of global cyberattacks and is the nation’s largest investment in cyber security to date.
The Technology Investment Boost will be critical in empowering small businesses to get serious about Cyber Security, allowing them to review and adopt enhanced cyber security measures such as malware detection, mitigation, and response.
Read more on how Diamond IT recommends ways to enhance your Cyber Security posture.
Security Standards and Regulations
With potential cyberattacks on critical sectors like healthcare, utilities, education and transport no longer a question of if, but when, organisations are under increasing scrutiny about how they are protecting and using their business data.
Small Businesses are not immune and are under increasing pressure to comply with security standards such as ISO 27001, or for some specific industries, the DESE ISMS Scheme, to ensure that information about employees, clients, products, processes and strategy remains secure.
Diamond IT's team of Business Technology Consultants is currently working with key organisations across a range of sectors to ensure their ISO 27001 and DESE ISMS preparedness.
Cloud Computing
In line with supporting growth for small businesses and enabling them to be more agile and scale, the Technology Investment Boost also provides a bonus tax deduction for subscriptions to cloud-based services. Available in many forms from many vendors, Cloud technology options can be complex and daunting. Diamond IT can work together with you and your team to help find the right solution for your business.
Skills and Training Investment Boost
Also announced was an initiative to encourage small businesses to focus on the skills development of their staff, to "become more productive and competitive” the Skills and Training Investment Boost does not stipulate a limit to the amount of spending that can be deducted against training courses.
It does however, specify that certain rules apply, such as that the course must be run by an external education provider, which needs to be registered in Australia.
Key points to note:
- Applicable to businesses with an annual turnover less than $50 million
- Effective from March 29th 2022, 7.30pm - June 30th 2023
- No annual cap
- $120 tax deduction per $100 spent
- External Education Provider registered in Australia
- In-house and On-the-job training is not eligible
How Diamond IT can support your business
We recommend talking to your accountant or financial advisor to learn more about the recent budget announcement and how you can take advantage of the tax boosts available for your business. Subject to eligibility advice on what is deductible, Diamond IT may be able to support you directly or with consultative advice around: Cloud Computing and Cyber Security - Systems, Posture, Governance and Training.
Our team has significant experience working with a range of customers on ensuring their technology strategy and investments are inline with, and supporting key business drivers and strategic objectives.
Talk to today on 1300 307 907 for more information on how we can work together with you on your Technology Roadmap.
