The Skills and Training Boost has been reignited, bringing a 20% bonus tax deduction for external training costs for staff. The bonus deduction is designed to assist you in training and upskilling your employees.
It is available for expenses you incur between 29 March 2022 and 30 June 2024. If you have incurred eligible staff training expenses before 30 June 2022, you will need to wait until your 2022-23 tax return to claim.
To qualify for the bonus deduction, you will need to engage an external training organisation that is registered in Australia to complete the training. The additional deduction is not available for on-the-job or in-house training costs.
Also, the bonus deduction is available for your employees only. Therefore, if you are a sole trader or partner in a partnership, you can only make a tax deduction claim under self-education in your individual return. Your associates and independent contractors are specifically excluded from the bonus deduction.
Training a new employee who requires upskilling for their new role, for example, would be eligible for the bonus deduction.
This measure was originally announced by the former government in the 2022 Federal Budget. It is expected that it will pass through the parliamentary process and become law.
If you have any questions, please contact our office. We would be delighted to assist you further.