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Better Targeted Super Concessions (The $3M Cap)
Treasurer Dr Jim Chalmers unveiled the proposed Better Targeted Super Concessions as a new tax on super in February 2023...
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We have summarised the key points from the 2022-2023 budget, that we believe will have the most impact on our clients.
Please keep in mind that all budget measures are proposals and will require the passage of legislation to become effective.
Summary points for businesses
Small businesses (with an aggregated annual turnover of less than $50 million) will be able to deduct an additional 20 per cent of the cost incurred on business expenses and depreciating assets that support their digital adoption, such as portable payment devices, cyber security systems or subscriptions to cloud-based services.
The boost will apply to eligible expenditure incurred from 7:30pm (AEDT) on 29 March 2022 (Budget night) until 30 June 2023.
An annual cap will apply in each qualifying income year so that expenditure up to $100,000 will be eligible for the boost.
The boost for eligible expenditure incurred by 30 June 2022 will be claimed in tax returns for the following income year. The boost for eligible expenditure incurred between 1 July 2022 and 30 June 2023 will be included in the income year in which the expenditure is incurred.
Small businesses (with an aggregated annual turnover of less than $50 million) will be able to deduct an additional 20 per cent of expenditure incurred on external training courses provided to their employees. The external training courses will need to be provided to employees in Australia or online and delivered by entities registered in Australia.
The boost will apply to eligible expenditure incurred from 7:30pm (AEDT) on 29 March 2022 (Budget night) until 30 June 2024.
Some exclusions will apply, such as for in-house or on-the-job training and expenditure on external training courses for persons other than employees.
The boost for eligible expenditure incurred by 30 June 2022 will be claimed in tax returns for the following income year.
The renamed Australian Apprenticeships Incentives Scheme has been retargeted so that apprentices, as well as employers, receive financial incentives.
Under the scheme, from July 1 employers in “priority occupations” will receive a 10 per cent wage subsidy for first and second-year apprentices and 5 per cent for third years. The subsidy caps out at $15,000.
In a significant change, apprentices will be eligible for $1250 every six months for two years, up to a total of $5000.
The ‘patent box’ scheme will expand to cover developments in agriculture and low emission technologies.
The scheme originally permitted income derived from Australian-born medical and biotech patents to be taxed at a concessional rate of 17%; applying the same tax rate to climate-focused tech is hoped to foster climate-focused innovation at home.
The proceeds from the sale of Australian Carbon Credit Units (ACCUs) and biodiversity certificates generated from on-farm activities are to be treated as primary production income for the purpose of the Farm Management Deposits (FMD) scheme and primary production tax averaging from 1 July 2022.
If you have any questions or concerns about the proposals from the Federal budget announcements, please contact your Ulton Advisor to discuss.
Want to learn more about the other announcements from the 2022 budget? Click on the links below to go through to the specific summary or view the entire summary here.
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Treasurer Dr Jim Chalmers unveiled the proposed Better Targeted Super Concessions as a new tax on super in February 2023...
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It has long been the ATO’s practice to treat a trust’s unpaid present entitlements (“UPE”) to a company as a loan for th...
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Small businesses with an aggregated turnover of less than $50 million will be able to claim a bonus deduction equal to 2...
