What is the Small Business Technology Investment Boost?

The Small Business Technology Investment Boost is a scheme aimed at helping businesses take advantage of digital technologies in an effort to support a more productive and resilient economy.

Small businesses with an aggregated turnover of less than $50 million can now access an extra 20% deduction on eligible expenses incurred on digitising their operations. Eligible business expenses and purchases of depreciation assets must be incurred between 7.30pm AEDT on 29 March 2022 and 30 June 2023. Maximum boost that can be received in respect of 2021-2022- and 2022-2023-income years is capped at $20,000 a year.

What you can claim

Digital enabling items

• Computer and telecommunications hardware and equipment
• Software
• Internet costs
• Systems and services that form and facilitate the use of computer networks digital media and marketing

Audio and visual content

• Audio and visual content that can be created, accessed, stored or viewed on digital devices, including web page design e-commerce

Eccomerce

• Goods or services supporting digitally ordered or platform-enabled online transactions
• Portable payment devices
• Digital inventory management
• Subscriptions to cloud-based services
• Advice on digital operations or digitising operations, such as advice about digital tools to support business continuity and growth

Cyber security

• Cyber security systems, backup management and monitoring services

Eligibility

Following are some examples of expenses that can be eligible for this boost. Please check with your tax agent for more tailored advice on your business.

Depreciation assets

• Laptops
• Desktop computer screens
• Smart phones
• Tablets
• Printers and scanners
• Cameras
• Projectors
• POS systems

Dates for depreciation assets

The depreciation assets must be first used or installed ready for use between 7.30pm AEDT on 29 March 2022 and 30 June 2023 to be eligible. This rule does not apply to in-house software costs allocated to a software development pool in-consistent with current pooling rules.

Repair & Improvement Costs

Repair and improvement costs to depreciation assets during the relevant time period are also eligible for the extra deduction. If you dispose the asset during the relevant period, the bonus deduction cannot be claimed, unless it is an involuntary disposal, where the asset is lost or destroyed.

Software costs

Software subscriptions:

Purchase or upgrade software subscriptions such as:

• Accounting (eg. Xero, MYOB)
• Payroll, customer relations management (CRM) software (eg. Salesforce)
• Inventory management software
• Software licence fees (i.e. Antivirus software licence fee)
• Online payment platform costs (i.e. Paypal, Stripe, Afterpay)
• Website and software design and development costs
  

Payments made during the relevant period to such software subscriptions businesses are already using, are also eligible for the boost.

IT costs

• Internet charges
• Cyber security costs (i.e. backup management, monitoring)
• Digital marketing costs (i.e. payments for Google and Gumtree ads)
• Data storage costs (i.e. cloud storage platforms)
• IT consulting and management fees
• Web hosting costs

What you cannot claim

The following expenses are not eligible for this boost

• Salaries and wages
• Capital works costs
• Financing costs
• Training and education costs (these may be eligible to claim under small business skills and training boost)
• Expenses that form part of your trading stock costs

When and how to claim

For the expenses incurred between 7.30pm AEDT on 29 March 2022 and 30 June 2022, 20% bonus deduction can be claimed in 2022-23 tax return.

For the expenses incurred between 01 July 2022 and 30 June 2023, 20% bonus deduction can be claimed in 2022-23 tax return.