As part of the 2022-23 Budget, the Government announced on March 29, 2022, that it will be supporting small businesses through new measures, specifically, the Skills and Training Boost Initiative. This initiative will allow eligible businesses to claim a bonus tax deduction on top of the already allowed deductions for training their employees.
Essentially, for every $100 spent on upskilling your team members, you will receive a $120 tax deduction. This is all well and good, but you might be wondering, who can receive this bonus and what does it entail? In this blog, we will be discussing exactly that and more.
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Understanding the Skills and Training Boost
What Will Make You Eligible
Boost applies to expenditure incurred between 7.30pm (AEDT) March 29, 2022, until June 30, 2024. If claiming this investment is of interest to you and your business, take into consideration that you will need to meet the small business expenditure criteria which is as follows:
- 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 (if any) 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.
Small businesses, whose combined annual turnover does not exceed $50 million, will have the opportunity to benefit from an extra 20% deduction on expenses incurred for eligible training courses offered to their team by registered providers in Australia.
Imperative Considerations
It’s important to take into consideration that the Skills and Training Boost Initiative is not yet law, as it is still in the drafting stages. The government is actively seeking input from stakeholders regarding the exposure draft legislation and the accompanying explanatory materials that aim to implement this measure.
Extra Information Provided by the Treasury
- Exposure Draft
- Explanatory Materials
Contact Taggart & Partners Today!
If you’re looking for more information or assistance in understanding this Skills and Training Boost Initiative for your business, get in touch with our team on (07) 3391 1188 or reach out through our online form and we’ll get back to you. As a tax financial adviser, we are here to make life as easy as possible for our clients. Have an unrelated question or query? We are also available via email at [email protected].
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