Instructions and information for claiming the small business skills and training or technology investment boosts.
Small business skills and training boost
Enter the amount claimed by the AMIT for the small business skills and training boost. Do not include the total amount for skills and training expenditure at this label.
The amount of the boost, or bonus deduction, is equal to 20% of the total eligible skills and training expenditure that you can claim as a general deduction or under another deduction provision of the tax law.
The small business skills and training boost provides a temporary bonus deduction to those entities that meet the definition of 'small business entity' (or would meet that definition if the reference to an aggregated turnover of $10 million was replaced by a reference to $50 million). The bonus deduction is for expenditure that the entity incurs in providing eligible external training courses to employees by eligible registered training providers.
The bonus deduction is an additional tax deduction of 20%, on top of their ordinary deduction, for eligible expenditure incurred from 7:30 pm (AEDT) on 29 March 2022 to 30 June 2024. It applies to enrolments or arrangements for the provision of eligible training made or entered into at or after 7:30 pm (AEDT) on 29 March 2022.
The small business entity must also meet the following criteria for the bonus deduction:
- expenditure must be for training employees, in-person in Australia or online
- expenditure must be charged, directly or indirectly, by an eligible registered training provider and be for training within the scope of the provider's registration
- the eligible registered training provider must not be the small business entity or an associate of the small business entity, and
- expenditure must already be deductible under the taxation law.
Expenditure for training persons other than employees is not eligible for the bonus deduction.
The ordinary deduction for eligible skills and training expenditure is claimable under the usual rules in the income year in which the expenditure is incurred. However, special rules apply in claiming the bonus deduction for the eligible expenditure. When you claim the bonus deduction also depends on your balancing date if the small business has a substituted accounting period.
When the bonus deduction is claimed (unless you are an early balancer)
- If you incurred the expenditure from 7:30 pm (AEDT) on 29 March 2022 to the end of your 2022–23 income year, you claim the bonus deduction in respect to this expenditure in the 2022–23 income year. This means that you claim the bonus deduction for eligible expenditure incurred in both the 2021–22 income year and the 2022–23 income year in your 2022–23 tax return.
- If you incur the expenditure for 2023–24 income year (up until 30 June 2024), you claim the bonus deduction in respect to this expenditure in the 2023–24 income year.
When the bonus deduction is claimed if you are an early balancer
- If you incurred expenditure from 7:30 pm (AEDT) on 29 March 2022 to the end of your 2022–23 income year, you claim the bonus deduction in respect to this expenditure in the 2023–24 income year.
- If you incurred expenditure in your 2023–24 income year, you claim the bonus deduction in respect to this expenditure in the 2023–24 income year.
- If you incurred expenditure for your 2024–25 income year (up until 30 June 2024), you claim the bonus deduction in respect to this expenditure in the 2024–25 income year.
Small business technology investment boost
Enter the amount claimed by the AMIT for the small business technology investment boost. Do not include the total technology investment expenditure at this label.
The amount of the boost, or bonus deduction, is 20% of the total amount of eligible technology and investment expenditure that you can claim as a general deduction or under another deduction provision of the tax law capped at a maximum of $20,000 per relevant time period.
The small business technology investment boost provides a temporary bonus deduction to those entities that meet the definition of small business entity (or would meet that definition were reference to $10 million replaced by a reference to $50 million) for expenditure incurred, and depreciating assets acquired, for the purposes of their digital operations or digitising their operations.
The bonus deduction is an additional tax deduction of 20%, on top of the ordinary deduction, for the eligible expenditure incurred between 7:30 pm (AEDT) on 29 March 2022 and 30 June 2023.
Bonus deduction caps
Certain caps apply to the amount that you can claim as a bonus deduction depending on your balancing date if you have a substituted accounting period.
If you are not an early balancer:
- you can claim up to a maximum of $20,000 on eligible expenditure of up to $100,000 for the period from 7:30 pm (AEDT) on 29 March 2022 to the end of your 2021–22 income year.
- you can claim up to a maximum of $20,000 on eligible expenditure of up to $100,000 for the period from the start of your 2022–23 year to 30 June 2023.
If you are an early balancer:
- you can claim up to a maximum of $20,000 on eligible expenditure of up to $100,000 for the period from 7:30 pm (AEDT) on 29 March 2022 to the end of your 2022–23 income year.
- you can claim up to a maximum of $20,000 for eligible expenditure of up to $100,000 for the period from the start of your 2023-24 income year to 30 June 2023.
The cap on the bonus deduction works on a cumulative basis in respect of the eligible expenditure.
Criteria for claiming the bonus deduction
The small business entity must meet all of the following criteria for the bonus deduction:
- the expenditure must be eligible for a deduction under another provision of the taxation law
- if the expenditure is on a depreciating asset, the asset must be first used or installed ready for use by 30 June 2023
- if the expenditure is on a depreciating asset, the asset is not in-house software allocated to a software development pool
- the expenditure must be incurred wholly or substantially for the purposes of an entity's digital operations or digitising the entity's operations.
If expenditure is for multiple purposes (for example, a mix of private and business use), the bonus deduction will apply to the proportion of the expenditure that is for an assessable income-producing purpose.
You cannot claim the bonus deduction for expenditure on a depreciating asset if any balancing adjustment event occurs to the asset while the entity holds it during the relevant time period, unless the balancing adjustment event is an involuntary disposal.
The following types of expenditure are not eligible for the technology investment bonus deduction:
- salary and wage costs
- capital works costs which can be deducted under Division 43 of the ITAA 1997
- financing costs
- expenditure that forms part of, or is included in, the cost of trading stock
- training and education costs.
Repair and improvement costs for depreciating assets are eligible for the bonus deduction provided that these costs are incurred during the relevant time period.
For depreciating assets, business entities either deduct the cost of a depreciating asset in one income year (under the temporary full expensing regime (TFE)) or, if opted out of TFE for an asset, deduct the decline in value of the asset over its effective life (under the uniform capital allowance regime). The bonus deduction of an eligible depreciating asset is calculated based on the asset's cost (to the extent that it is used for a taxable purpose) regardless of the method of deduction that the entity takes.
When the bonus deduction is claimed
The ordinary deduction for eligible technology investment expenditure is claimable (under the usual rules) in the income year in which it is incurred, and for depreciating assets, when the asset is first used or installed ready for use. However, special rules apply to the bonus deduction. When you claim the bonus deduction also depends on the balancing date if the small business has a substituted accounting period.
When the bonus deduction is claimed (except if you are an early balancer)
If you incurred expenditure between 7:30 pm (AEDT) on 29 March 2022 and the end of your 2022–23 income year, you claim the bonus deduction in respect of this expenditure in the 2022–23 income year.
This means that you claim the bonus deduction for eligible expenditure incurred in both the 2021–22 income year and the 2022–23 income year in your 2022–23 tax return.
When the bonus deduction is claimed if you are an early balancer
- If you incurred expenditure between 7:30 pm (AEDT) on 29 March 2022 and the end of your 2022–23 income year, you claim the bonus deduction in respect of this expenditure in the 2023–24 income year.
- If you incurred expenditure for your 2023–24 income year (up until 30 June 2023), you also claim the bonus deduction in respect to this expenditure in the 2023–24 income year.
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