The small business energy incentive is designed to help businesses improve energy efficiency and save on energy bills. Businesses with an aggregated annual turnover of less than $50 million will have access to a bonus 20% tax deduction for the cost of eligible assets and improvements that support more efficient use of energy.
This applies to eligible expenditure on assets between 1 July 2023 and 30 June 2024. It also applies to expenditure on improvements to existing assets for the same period. Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000.
Examples of eligible expenditure include:
- electrifying equipment (for example, installing a reverse cycle air conditioner in place of a gas heater).
- upgrading to more energy efficient appliances and equipment (for example, energy efficient refrigeration systems).
- installing time-shifting devices which allow electrical appliances to operate at off-peak times.
- replacing a diesel engine with an electric motor.
The usual rules for claiming deductions still apply. You can only claim the business portion of the expense and you need to make sure you have records to prove it.
How can we help?
Get in touch with your WMS advisory on 07 5556 3300 or at info@wmsadvisory.com.au
