On 29 March 2022, as part of the 2022–23 Budget, the then government announced it would support small business through these new measures. The measures became law on 23 June 2023.
The technology boost provides eligible small businesses with a bonus tax deduction for qualifying expenditure that was incurred in the period commencing 7:30pm AEDT 29 March 2022 until 30 June 2023 that relates to digitising the operations of the business.
The bonus deduction is calculated as 20% of the qualifying expenditure. However, this is capped at a maximum bonus deduction of $20,000 per income year. As the boost can apply to expenditure incurred in part of the 2022 income year and across the 2023 income year this will work as follows for an entity that has a standard 30 June year-end:
• There is a maximum bonus deduction of $20,000 for expenditure incurred in the 2022 year; and
• There is a separate maximum bonus deduction of $20,000 for expenditure incurred in the 2023 year.
In order to qualify for the boost the expenditure must be incurred wholly or substantially for the purposes of the entity’s digital operations or digitising the entity’s operations.
The below list are the types of expenditure that might qualify:
• 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 that can be created, accessed, stored or viewed on digital devices, including web page design;
• E-commerce – goods or services supporting digitally ordered or platform-enabled online transactions, portable payment devices, digital inventory management, subscriptions to cloud-based services, and advice on digital operations or digitising operations, such as advice about digital tools to support business continuity and growth; or
• Cyber security – cyber security systems, backup management and monitoring services.