Boost your business with help from the tax office
Posted on April 29, 2022
Some good news for SME’s – the proposed Small Business Technology Investment Boost announced as part of the 2022 Federal Budget is also supported by Labor, so following the upcoming Federal election, SME’s are likely to gain a tax boost when they invest in ‘digital adoption’.
What is the proposed tax boost?
Businesses with aggregated annual turnover of less than $50 million can claim an additional 20% deduction on business expenses and depreciating assets that support digital adoption. In other words, spend $100 but claim against $120. Bonus!
These expenses are capped at $100,000 per annum and, subject to the fine print of the final legislation, can be incurred from 29 March 2022 until 30 June 2023.
Check out the Australian Taxation Office (ATO)’s website for timing your claims.
What is “digital adoption”?
We need a crystal ball to predict exactly what will fall under this when the proposal becomes law, but so far the Government lists portable payment devices, cyber security systems, and subscriptions to cloud based services.
That makes sense. Businesses running on well-designed, maintained, and up-to-date technology are more efficient, more productive, and more competitive. This translates into jobs and tax revenue for the Government so backing SMEs is always going to be a good call.
You know you should
With bipartisan support for the tax boost and broad categories for what will qualify as an eligible deduction now public, business owners and managers can plan from now. Here are some projects you can get underway.
Invest in better IT hardware
Expecting your team to be productive, efficient, and good at their jobs by using old technology is like giving a Formula One team an old Kombi van. There’s a reason Mercedes, Ferrari and McLaren are constantly upgrading the cars – it helps them win races.
Likewise, the right technology can help your business perform better with reduced downtime, increased speed, and functionality. According to Moore’s Law, computer processing speeds are doubling every 18 months, so your hardware is ageing very quickly. We recommend our clients upgrade their laptops and PC’s every 3 years.
Manage passwords in the cloud
We recommend long, complex, often-changed passwords to help keep your business’s data secure but in reality, that doesn’t always happen. Team members might use one password for all their logins, they never change their passwords, or you lose access to an account when someone leaves. This creates a significant vulnerability across your entire business.
Our Tips to Strengthen Password Security is helpful, but we also recommend using a business-grade password management tool like LastPass to make things a lot easier for you. LastPass securely stores all your passwords, PINs and other access data within a single sign-in and encrypted application. Then it auto-populates your saved username and password for any secure sites you need to access without the need to remember.Strengthen your cyber-protection
David Perrett, our Chief Technology Officer maintains that any business - whether dipping their toe in cyber-security for the first time, or well versed - need to regularly assess their current security posture to find any gaps and make improvements.
To help, our free Cyber Security Assessment gives you a benchmark on how well you’re currently protected against a data breach and recommendations for improvement you can implement. It doesn’t cost anything other than 15 minutes of your time to complete.
The Small Business Technology Investment Boost could well be the nudge you need to get your business upgrade plans off the drawing board and into reality. But don’t feel you need to figure it out alone. Our team can work with you to understand what you want to achieve and translate that into a technology plan to get you there. Reach out to us - your tax accountant will be glad you did!