Valuable Tax Deduction Opportunity for Small Businesses

What is the Small Business Skills and Training Boost?

• Small businesses can now claim an extra 20% tax deduction on top of their usual deductions for certain employee training expenses.
• This applies to costs incurred from 7:30 pm AEDT on 29 March 2022 until 30 June 2024.

Are You Eligible?

• Your business must have an aggregated annual turnover of less than $50 million.
• Training must be for employees (not business owners or independent contractors).
• Courses must be provided by registered training providers and already tax-deductible.
• Expenses must be incurred within the specified period.

What Can You Claim?

• Costs of external training courses for your employees provided by registered training providers.
• Incidental costs, such as books and equipment needed for the course, if charged by the training provider.

Exclusions:

• Training for non-employee business owners or independent contractors is not covered.
• Costs added by intermediaries, such as commissions or fees, are not deductible under this boost.

Special Note for R&D:

• Businesses claiming under the R&D tax incentive program can still claim the bonus deduction without affecting their R&D claims.

When Can You Claim?

• Deductions are generally claimed in the year expenses are incurred.
• For expenses from 7:30 pm AEDT 29 March 2022 to 30 June 2022, claim the full deduction in your 2021–22 return, and the 20% bonus in your 2022–23 return.
• For expenses incurred in the 2022–23 and 2023–24 income years, claim both the regular and bonus deductions in the respective year's return.

FBT Reminder:

• Keep in mind the potential Fringe Benefits Tax (FBT) consequences associated with training expenditure.

Action Needed:

• Ensure you're choosing eligible training providers.
• Keep detailed records of all relevant expenses.

Don't miss out on this valuable opportunity to invest in your employees' development while also receiving a tax benefit! Contact us today, and we can help you navigate the specifics and maximise your claims under this new initiative.