Small Business Technology Investment Boost – Overview

The Small Business Technology Investment Boost is an ATO tax incentive that allows eligible businesses to claim an extra 20% tax deduction on technology-related expenses, up to a specified limit. This initiative aims to help small businesses improve operations through digital investment.

Who Qualifies?

To be eligible, businesses must:

• Have an annual turnover of under $50 million
• Be a sole trader, partnership, company, or trust
• Incur expenses directly linked to digital operations

Eligible Timeframe

• Expenses must be incurred between 29 March 2022 (7:30 PM AEDT) and 30 June 2023
• If the expense is for a depreciating asset, it must be first used or installed by 30 June 2023

What Expenses Qualify?

✔ Digital Tools & Software – Computers, hardware, software (e.g., Xero, MYOB), internet costs, networking systems ✔ Digital Marketing – Website design, digital media creation ✔ E-Commerce – Online payment systems, cloud services, digital inventory management ✔ Cybersecurity – Security systems, backup management, monitoring services ✔ Depreciating Assets – Computer equipment and digital-related assets

What’s Not Covered?

✘ Wages & Salaries ✘ Phone Bills ✘ Capital Works & Financing Costs ✘ Training (may qualify for a separate boost) ✘ Trading Stock Expenses

How to Claim

• The deduction is applied as a tax adjustment in your 2023 Income Tax Return
• The maximum expenditure cap is $100,000 per year, resulting in a $20,000 bonus deduction per year
• Since the scheme covers part of 2022 and all of 2023, the total possible bonus deduction is $40,000

What You Need to Do

✅ Ensure expense details are clear and attach invoices in bookkeeping software ✅ Separate eligible expenses from non-eligible ones (e.g., phone vs. internet) ✅ Identify any private portion of expenses before submitting ✅ Contact your MGI advisor if you have questions

FAQs

Does the boost cover existing technology? Yes, it applies to both new and existing digital tools.

Are social media ads eligible? Likely, as they fall under Digital Media & Marketing, provided they directly support business operations.

What if I invested in digital tools before the eligible period? Only expenses incurred within the timeframe qualify. However, depreciable assets may still be eligible depending on depreciation rules.

For more details download , the factsheet now, and also refer to the ATO website.

More resources:

• Factsheet: Australian SMEs weigh in on the upcoming 2022 budget and election
• Australia’s financial wellness
• Measuring the ROI of Employment Hero
• HR Audit Checklist Template
• What Australian employees want