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Federal Budget 2022: Education and training

March 2022

Admidst concerns about inflation, the Federal Budget has included some measures for skilling and training employees.

$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.

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.

For more information, please contact us on 02 9957 4033. 

More from the Federal Budget

Federal Budget 2022: A Budget for the Ballotbox

Federal Budget 2022: For you and your family

Federal Budget 2022: Your Super

Federal Budget 2022: Business and Employers

Federal Budget 2022: Government and Regulation

Federal Budget 2022: Other announcements

Federal Budget 2022: The Economy

 

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Disclaimer

This article is provided for information purposes only and correct at the time of publication. It should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.

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