Posted on October 22, 2023 by admin
Could your small business claim a 20% bonus deduction on technology expenditure that supports their digital operations or the digitisation of their operations?
The small business technology investment boost is a broad measure intended to cover a wide range of business expenses and assets; however, questions may arise when you go to claim.
To access the small business technology investment boost, your business needs to meet the standard aggregated annual turnover rules (with an increased $50 million threshold).
The expenditure must:
If the expenditure is on a depreciating asset, the asset must be first used or installed ready for use for a taxable purpose by 30 June 2023.
A good indicator of eligibility is to consider if the small business would have incurred the expense if they didn’t operate digitally. That is if they hadn’t sought to adopt digital technologies in the running of their business. Using this rule of thumb, the costs below are eligible:
Eligible expenditure may include, but is not limited to, business expenditure on:
Whether some expenditure is eligible for the boost will depend on its purpose and link to digitising the operations of the specific small business. For example, the cost of a multifunction printer would not be eligible if it were intended only to make copies of paper documents. However, it would be claimable if it was being used to convert paper documents for digital use and storage
New and ongoing subscription costs can also qualify as eligible expenditures if related to your client’s digital operations. For example, your ongoing subscription to an accounting software platform for your business would qualify. Likewise, a new subscription for digital content that is used in developing web content to advertise their business would be eligible.
In these cases, you should keep explanations of how the expenses relate to digitising their business, as well as accurate records of all their claims.
Where the expense is partly for private purposes, the bonus deduction can only be applied to the business-related portion.
Special rules apply if claiming the bonus deduction for eligible expenditure on a depreciating asset.
To avoid confusion or complications around applying the small business technology investment boost, it may be best to speak to your trusted tax agent. We’re here to help.
Posted on December 10, 2023 by admin
As retirees embrace a new phase in their lives, the concept of property downsizing is gaining momentum as a strategic and rewarding financial move.
Downsizing isn’t just about reducing square footage; it’s a lifestyle choice that can offer a range of benefits for those entering their golden years.
Many retirees find themselves sitting on a valuable asset—the family home. The Australian property market has witnessed significant growth over the years, and this presents a unique opportunity for retirees. Downsizing involves selling a larger property, often the family home, and purchasing a smaller, more manageable one. This shift not only streamlines day-to-day living but also releases equity tied up in the existing property.
One of the primary advantages of downsizing for retirees is the financial windfall it can generate. Selling a larger property in a desirable location can lead to a substantial cash injection. This liquidity can be used to fund retirement activities, travel plans, or simply serve as a safety net for unexpected expenses. Downsizing gives retirees the financial freedom to enjoy their retirement years without the burden of maintaining a larger property.
Downsizing often means trading a sprawling home for a more compact, easily maintainable residence. This can result in reduced household chores, lower utility bills, and a generally more manageable living environment. Additionally, many retirees choose to downsize to a location that offers greater convenience, such as proximity to amenities, healthcare facilities, and public transportation, enabling a more active and engaged lifestyle.
While the benefits of downsizing are clear, the process requires careful consideration and planning. It’s essential for retirees to assess their current and future needs, identify the ideal location, and understand the financial implications of the move. Seeking advice from financial planners and real estate professionals can help retirees make informed decisions that align with their retirement goals.
Recognizing the positive impact downsizing can have on retirees and the property market, the Australian government has introduced incentives to encourage this trend. The Downsizer Contribution allows eligible individuals to contribute up to $300,000 from the proceeds of selling their home into their superannuation fund, providing an additional financial boost for retirement.
Property downsizing for retirees is not just a practical choice; it’s a transformative step towards a more fulfilling retirement. By unlocking the equity in their homes, retirees can enjoy financial freedom, a more convenient lifestyle, and potentially even take advantage of government incentives.
As the trend continues to grow, downsizing is proving to be a key strategy for retirees looking to make the most of their golden years.
