Tick tock: SMEs have until June 30 to claim up to $20,000 in tech tax bonuses

Last week the Senate passed the Skills and Training Boost and the Technology Investment Boost, meaning small businesses now have the potential to claim up to $20,000 in additional tax bonuses this financial year, but only if you spend before June 30 — yes, this Friday. While the boost has only just been legislated, claims can be backdated to when it was first announced in March 2022. 

This boost is the result of consistent, persistent advocacy by MYOB, and is designed to support the 39% of small and medium-sized enterprises (SMEs) who are failing to grasp the opportunities offered by new technology, and the 31% who are not currently able to keep up with technology changes critical to their success. 

So, with such a short timeframe in which to act, now is the time to look at what you could invest in to maximise the value of this boost for your business. 

Here’s what you need to know.

Eligibility and limits

The Technology Investment Boost promises 20% ‘bonus’ tax breaks to small businesses investing up $100,000 in new tech, equating to a maximum deduction of $20,000. This includes any tech expenses from 7.30pm on March 29, 2022 to June 30, 2023. 

To be eligible, your business needs an aggregated annual turnover of less than $50 million. 

What’s counted as ‘tech’?

The boost is designed to cover anything that helps small businesses to digitise, or to improve their digital presence and processes. This includes computers, portable payment tiles, cybersecurity protection, business management software subscriptions, or subscriptions to other cloud-based services.  

If in doubt, have a conversation with your accountant or bookkeeper now to check if anything you’ve already invested in could be considered in the boost, and ascertain how much more you could claim in your tax returns if you decide to purchase additional tech for your business. 

Why go digital?

If you’ve been on the fence about investing in new technology or digitising your business, now is the time to act. 

While the pandemic was the catalyst for many small businesses to introduce or grow their digital presence, our research shows that approximately half a million Australian SMEs still have low or no levels of digitisation. 

This impacts productivity and is causing a growing gap between the digital ‘haves’ and ‘have nots’. Deloitte research found businesses with an advanced level of digitisation are 50% more likely to increase revenue, seven times more likely to scale, and eight times more likely to create jobs.

Reach for the cloud

The adoption of cloud computing has accelerated in recent years, partly by increased demand for teams working in hybrid environments to have access to applications and systems remotely and securely. 

The June MYOB Business Monitor found 67% of SME respondents have become more concerned about cybersecurity in the last year, another factor fueling the move to secure cloud products.

So, look at the cloud-based software you could invest in now, to boost the productivity, communication, and processes of your team for the next financial year (and beyond). The beauty of cloud subscriptions is that they continue to be upgraded and stay relevant, thanks to live updates as new features are added.

Stretch your dollar

There’s no doubt cash is tight right now but investing in technology with the 20% bonus deduction will save you time and money in the long term. Digital tools used effectively are designed to maximise efficiency, so ensure you’re using solutions that integrate and connect with each other.

Don’t delay

While there was talk of extending the deadline for the boost into 2024, this hasn’t yet eventuated, so you have only a few days to make the most of this incentive. 

Acting now could save you thousands in tax and enable you to reap the significant long-term benefits of digitisation for your business. 

Helen Lea is the chief employee experience officer and government policy lead at MYOB.