Most businesses nowadays have some sort of website, but designing, creating and maintaining a website for your business can be complicated. Many businesses use website services to develop and design their website for them if they don’t have the expertise or time to do it themselves.
Often, this can be an expensive venture. Not only is there a fee to create the website, but there are often the continual costs of tweaks, maintenance and upgrades after the website are already up and running. 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 typically claim 20% 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, you can claim a deduction for the full expense amount in the income year they acquire the expense.
- If the website costs are equal to or more than the instant asset write-off threshold, owners can allocate it to a general small business pool for accelerated depreciation deductions.
However, it should be noted that you cannot use the simplified depreciation rules if you choose to allocate expenditure on the software to a software development pool.
You can also 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.