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Claiming tax deductions for your website

Posted on 24 November '15 by , under General News.

Designing, creating and maintaining a website for your business can be complicated. Many of today’s small businesses employ the services of a web developer and designer to take care of getting a website up and running since they don’t have time or expertise to be able to do it themselves.

Often, this can be an expensive venture. But luckily, small businesses can claim deductions for website development costs.

Businesses that incur the cost of developing a website before they begin running their business can claim 20 per cent of the cost each year over five years upon starting up.

Businesses that are already up and running with an aggregated turnover of less than $2 million can use the simplified depreciation rules;

  • If the cost of the website development is less than the instant asset write-off threshold of $20,000, owners can claim a deduction for the full expense amount in the income year they acquire the expense.

  • If the website costs the same or more than the instant asset write-off threshold, owners can allocate it to a general small business pool.

Business owners cannot use the simplified depreciation rules if they choose to allocate expenditure on the software to a software development pool.

Business owners are also able to claim an outright deduction for specific running and maintenance costs, such as server hosting fees, domain name and registration fees in the same income year the expenses are incurred.