Employers, here’s a few hints to help you keep on top of things at tax time:

  • Single Touch Payroll (STP) finalisation: you need to finalise your employees’ STP data by 14 July, as they use this information to complete their tax return. Remember to double check that you’re finalising STP data for the 2022–23 financial year – particularly if doing so early in July.
  • PAYG withholding: you’ll need to lodge a PAYG withholding annual report for all payments not reported and finalised through STP.
  • Tax tables: make sure you’re using the PAYG withholding tax tables or tax withheld calculator when working out how much to withhold from payments you make to your employees or other payees.
  • Super guarantee (SG) rate: the SG rate increases from 10.5% to 11% from 1 July, Ensure your payroll and accounting systems are updated to include this.

Skills and Training Boost – Bonus Deduction 

A bonus deduction is now available for small businesses that incur eligible expenditure on external training for their employees.

The bonus deduction is calculated as 20 per cent of the amount of expenditure that is both deductible under another taxation law provision and eligible for the bonus deduction.

An entity will be eligible for the bonus deduction if, in the income year the expenditure is incurred, it is a ‘small business entity’ under s. 328-110 of the ITAA 1997 — i.e. an entity that carries on business with an aggregated annual turnover of less than $10 million.

Eligible expenditure – The bonus deduction will be available to eligible small businesses that incur expenditure which meets the following criteria:

  • Expenditure must be for training employees, either in-person in Australia, or online
  • Expenditure must be charged, directly or indirectly, by a registered training provider and be for training within the scope of the provider’s registration
  • The registered training provider must not be the small business or an associate of the small business
  • Expenditure must already be deductible under the taxation law
  • Expenditure must be incurred within a specified period (between 7.30 pm (by legal time in the Australian Capital Territory (ACT)) on 29 March 2022 and 30 June 2024)
  • Expenditure must be for the provision of training, where the enrolment or arrangement with the registered training provider for the provision of the training occurs at or after 7.30 pm (by legal time in the ACT) on 29 March 2022.
  • The cost of in-house or on-the-job training is not eligible expenditure for the purpose of the bonus deduction.

Claiming the bonus deduction – The general rule is that small businesses will claim the bonus deduction in the income year in which the expenditure is incurred.

Capital Allowances

As per the 2023-24 Federal Budget – The Government announced that the instant asset write-off threshold is $20,000.

The new threshold will apply from 1 July 2023 until 30 June 2024.  Assets costing $20,000 or more can be allocated to the small business depreciation pool and depreciated at 15 per cent in the first income year and at 30 per cent each subsequent income year.

Technology Investment Boost

The technology investment boost provides eligible businesses with access to a bonus deduction equal to 20 per cent of their eligible expenditure incurred on expenses and depreciating assets for the purposes of their digital operations or digitizing their operations in respect of each of the 2021-22 and 2022-23 income years.

Eligible entities – An entity will be eligible for the bonus deduction if, in the income year the expenditure is incurred, it is either:

a ‘small business entity’ under s. 328-110 of the ITAA 1997 — i.e. an entity that carries on business with an aggregated annual turnover of less than $10 million, or

an entity that would meet the definition of a small business entity under s. 328-110 of the ITAA 1997 if the reference to $10 million was replaced by a reference to $50 million.

Eligible expenditure – To be eligible for the bonus deduction, expenditure must be incurred wholly or substantially for the purposes of an entity’s digital operations or digitising the entity’s operations. That is, the eligible expenditure must have a direct link to the entity’s digital operations for its business. Expenditure on digital operations or digitising operations may include, but is not limited to, business expenditure on:

  • 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 and 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.

Calculating and claiming the bonus deduction The amount of the bonus deduction is calculated as 20 per cent of the total amount of eligible expenditure, up to a maximum bonus deduction of $20,000 per specified time period. This means that total expenditure eligible for the bonus deduction is effectively $100,000 over each relevant time period such that entities can generally claim a maximum bonus deduction of $20,000 per relevant time period, and an overall maximum total bonus deduction of $40,000. For depreciating assets, the bonus deduction is equal to 20 per cent of the cost (within the meaning of Div 40 of the ITAA 1997) of an eligible depreciating asset that is used for a taxable purpose. This means that regardless of the method of deduction that the entity takes (i.e. whether immediate or over time), the bonus deduction in respect of a depreciating asset is calculated based on the asset’s cost. When calculating the bonus deduction for expenditure on a depreciating asset, it is assumed that:

  • the entity will continue to hold the asset throughout its effective life
  • the entity will use the asset for a taxable purpose to the same extent that it does in the income year it first uses or installs the asset.

ABNs

  • There is currently no periodic renewal process for ABNs.  This means that an ABN remains active until the Registrar cancels it under the grounds set out in S.18 of the ABN Act, or the ABN holder requests that it be cancelled.