This is part of our series on the 2022/2023 Budget: See Overview
$120 deduction for every $100 spent on skills and training
From: 7:30pm AEDT, 29 March 2022 until 30 June 2024
The Government intends to provide a 120% tax deduction for expenditure incurred by small businesses on external training courses provided to employees. The deduction will be available to small business with an aggregated annual turnover of less than $50 million. External training courses will need to be provided to employees in Australia or online, and delivered by entities registered in Australia.
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.
We assume there will need to be a nexus between the employee’s employment and the training program undertaken for the boost, although we are waiting on further details of this initiative to be released.
The boost for eligible expenditure incurred by 30 June 2022 will be claimed in the tax return for the following income year (that is, the 2023 tax return). The boost for eligible expenditure incurred between 1 July 2022 and 30 June 2024, will be included in the income year in which the expenditure is incurred.
| · Media release: Digital and skills tax boost for small businesses |
Apprentice wage subsidy support extended
Just prior to the Federal Budget, the Government announced the extension of the:
- Boosting Apprenticeship Commencements wage subsidy, and
- Completing Apprenticeship Commencement wage subsidy.
Any employer (or Group Training Organisation) who takes on an apprentice or trainee up until 30 June 2022 can gain access to:
- 50% of the eligible Australian Apprentice’s wages in the first year, capped at a maximum payment value of $7,000 per quarter per Australian Apprentice,
- 10% of the eligible Australian Apprentice’s wages in the second year, capped at a maximum payment value of $1,500 per quarter per Australian Apprentice, and
- 5% of the eligible Australian Apprentice’s wages in the third year, capped at a maximum payment value of $750 per quarter per Australian Apprentice.
| Resources · Media release: Extending support to get more Australian apprentices on the job · Boosting Apprenticeship Commencements wage subsidy and Completing Apprenticeship Commencements wage subsidy · Applications are through the Australian Apprenticeships Support Network |
If we can assist you to take advantage of any of the Budget measures, or to risk protect your position, please let us know.