Small business sector given $1.5bn in tax breaks

The federal parliament has approved two new tax incentives for businesses to train their staff and improve their digital capacity. The Technology Investment Boost and the Skills and Training Boost are designed to make it easier for small and medium businesses to scale up and become more productive. Under these incentives, which have been backdated to 29 March 2022, businesses with an annual turnover of less than $50 million will have access to:

• A bonus 20% deduction for eligible expenditure on external training of employees by providers registered in Australia, until 30 June 2024.
• A bonus 20% deduction that will support the uptake of digital technologies, until 30 June 2023.

These two incentives are worth more than $1.5 billion and will be accessible by 3.8 million businesses that employ nearly 8 million workers, according to government figures. Treasurer Jim Chalmers said the government recognised the important role small businesses played in the economy. “When small businesses invest in digital technologies and upskilling staff, it boosts their productivity and drives economic growth,” he said. “That’s why we are making them law and backdating deductions so businesses are rewarded for the investments they’ve been making and can take advantage of this extra support.” Minister for Financial Services Stephen Jones said these incentives would help small businesses remain competitive in a rapidly changing technological landscape. “Millions of small businesses that have already invested in new technology this financial year will now be eligible to make deductions this tax time. It’s great news at a time where small businesses most need cash flow support,” he said. Tax incentives aside, the new financial year is always a time when businesses make plans to increase their profitability and invest in future growth. Contact me if you’d like to organise a business loan so you can finance your investment plans.