AutoGuru explains a new tax boost for upgrading tech and training staff

The 2022-23 federal budget announcement included tax incentives enabling small to medium business owners that invest in cloud software and employee training to claim deductions greater than the actual cost.
The scheme will provide a 20 percent bonus tax deduction for the cost of investing in tech tools and external skills training. Small businesses with a turnover of less than $50 million can claim spending up to $100,000 per year on eligible technologies and no limit on how much they can claim on training courses.
Eligible expenses over the $100,000 cap can be claimed as per usual tax processes. The bonus deduction applies to purchases made between 7.30pm on March 29, 2022 and June 30, 2023.
The new Small Business Technology Investment Boost is designed to encourage business owners to invest in digital tools to help streamline processes, remove double handling, and improve the customer experience. Included are portable payment devices, web design, e-invoicing and accounting and/or subscriptions to cloud-based services.
Based on initial statements, accounting and software costs from Xero, MYOB and QuickBooks, as well as garage management tools like Workshop Software and MechanicDeck, should qualify.
It is also possible that digital booking platforms like – which recently switched to a subscription membership model – could also qualify, being a cloud-based website service helping workshops acquire new customers and improve customer experience.
The Skills and Training Boost is designed to give automotive businesses a helping hand to attract and upskill staff. For every $100 eligible businesses spend on training employees, they will receive a $120 tax deduction.
The training cannot be in-house or on-the-job; it must be provided by an external organisation; and courses can be provided in person, anywhere in Australia, or online — so long as that external organisation is a company registered within Australia.
There is a wide range of specialised training and education courses that could qualify, from Registered Training Organisations and Motor Trades Associations to Automate, TaT and others. While the Budget statements are very broad, it is possible that Business Coaches like The Workshop Whisperer may also qualify.
The Skills and Training Boost was announced to come into effect on March 29, 2022 at the same time as the Small Business Technology Investment Boost, however according to recent statements from the ATO, the announced measures which are not yet law will be subject to consideration by the incoming government.
Businesses interested in claiming proposed technology and training tax concessions should seek independent tax advice to confirm eligibility prior to investment.

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