It’s hard to justify the costs of digital services when you’ve just launched a start-up, or your small business is struggling to stay afloat.
This is a shame.
Digital marketing, when done right, is one of the most powerful and cost-effective ways to connect with people who need your products or services.
Thankfully, the federal government also recognises this. It plans to help small businesses to cover costs for digital services such as web design.
In the most recent budget announcement, the government promised $1 billion in tax breaks for eligible businesses investing in digital technology.
What could this mean for you?
Digital services become A LOT more affordable.
For every $100 you spend on digital services, you will be able to deduct $120 from your taxes. You can claim deductions on eligible expenses up to $100,000 a year, for as long as the policy is valid.
Examples of eligible spending include:
- Web design
- Cloud computing
- Cybersecurity systems
- Online sales platforms
- Portable payment devices
Of course, this only applies if you’re making less than $50 million in aggregated turnover each year (which applies to most small businesses).
We shouldn’t get our hopes up too soon, though. The Small Business Technology Investment Boost isn’t legislation yet, but here’s what we can expect if it gets approval.
From the 29th of March 2022 to the 30th of June 2023, eligible businesses will be able to deduct a bonus 20% on digital technology expenses.
How to submit your claim?
Follow closely, it’s a bit convoluted because the government isn’t committing to anything for this year.
In other words:
If the proposal passes as law, you will be able to claim a 20% bonus for spending that occurred this year, but you have to wait until next year to get it.
- When filing your taxes for this year (2021-22), simply submit an expenditure claim as you normally would, for any qualifying digital expenses since the 29th of March 2022.
- Next year, when it’s time to submit your 2022-23 tax return, you’ll get to claim the 20% bonus deduction for this year (2021-22 financial year…but not for the entire period, only starting from March 29, when the policy was announced).
- Even better, next year you’ll also get to claim 120% on qualifying costs for the 2022-23 financial year.
Digital Burst helps small businesses to connect with their dream consumers:
We’re a Sydney-based agency with more than two decades experience helping companies to expand online. There are no fixed contracts for our stand-alone services, which are designed to help small businesses save money.
Digital Burst is a branch of E-Web Marketing, a leading company that works with businesses on a contract basis. We can give you the contact details of clients who are happy to share their references, if you’d like independent feedback!