The Technology Investment Boost was announced by the Government last year to encourage businesses to adopt digital technologies. When the legislation is passed, it will provide small or medium businesses with a 20% bonus deduction for eligible expenditure incurred for the purposes of an entity’s digital operations or digitising its operations. Importantly, the Technology Investment Boost is a temporary tax incentive, which is only available for eligible expenditure incurred between 7:30pm (ACT time) on 29 March 2022 and 30 June 2023.
Furthermore, claims related to eligible depreciating assets also generally require the asset to be used or installed ready for use by 30 June 2023. To be eligible for the 20% bonus deduction, a business taxpayer must satisfy a number of conditions. In particular, the deduction only applies to eligible expenditure incurred for the purpose of the entity’s digital operations or digitising the entity's operations. This may include (without limiting the type of expenditure which may be eligible):
- Digital enabling items — Including 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 costs — Including audio-visual content that can be created, accessed, stored or viewed on digital devices, including web page design.
- E-commerce – Including 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 (e.g., advice about digital tools to support business continuity and growth).
- Cyber security – Including cyber security systems, backup management and monitoring services.