This incentive currently expires 30th June 2018!
If you own or manage a small business investing in a solar energy system can not only be beneficial to reduced energy costs but the initial investment can potentially be claimed as a depreciation asset under the ATO’s 2015 Federal Budget tax concessions for small businesses.
This applies to small businesses with income of less than $10 million.
With this incentive you can:
“immediately write-off – deduct their full cost in the year you buy them – most depreciating assets that cost less than $20,000 (see note 1) each that were bought and used, or installed ready for use from 7.30pm (AEST) on 12 May 2015 until 30 June 2018”. source
“The Tax Office makes it clear that it considers a small energy generation unit or a solar water heater to be a depreciating asset. This means that a deduction is available where that asset is installed on a property wholly used to produce assessable income through rent or through the operation of a business”. Source
How to claim solar as a depreciating asset
Use your last bill, assess how much you’re paying for your energy and if a solar energy system would be financially beneficial. (we can help with that). Together we can assess what size system you would need for your energy consumption, if you’d require a battery and/or hybrid model and how long the payback period would be. For most small businesses the payback period is around 3 years.
We have written more about investing in solar energy as a small business here.
Combine the cost savings a commercial solar energy system will provide with the tax write-off available for this one-off payment depreciating asset you can claim for and you can create a serious business case for this investment.
Please speak to your tax professional about this incentive, the above is for reference only.