Instant Asset Write Off for Solar Power Installation

We love the benefits that Solar Energy can provide to our customers. From the reduction in electricity costs of day-to-day operations, to the positive impact on our precious environment, our vision is to make renewable solar energy accessible to all. So, what if we told you that your investment in Solar Energy and access to these benefits for small and medium business owners is even closer than you think?

Recent announcements within April’s Federal Budget provide further incentives for small and medium business owners to claim the full cost of their newly acquired solar assets through the extension of the Instant Asset Write Off. Through this extension, a tax deduction will be made available to business owners who purchase assets at a value of less than $30,000.

Updated: 16th March 2020.

To deal with the spread of Coronavirus, Government has announced a Economic Stimulus Package on 12th March 2020. Under the package, busiensses with a turnover of upto $500M can immediately write off assets valued under $150K instead of $30K.

How does this incentive make the investment more attainable you ask? Let’s have a look at a practical worked example for a business that is a company to see what can be achieved.

Say you decided to invest $29,000  in clean and green solar energy for your business which is then eligible for tax deduction with an associated tax benefit of $7,975 being applied (calculated at the small business company tax rate of 27.5%). Put simply:

Investment or Purchase Amount $29,000

Amount eligible for tax deduction $29,000

Reduction to income tax liability at company tax rate (27.5%) $(7,975)

Remaining investment to be repaid $21,025

That’s quite a difference between what was originally paid and your final investment! Imagine the reduction to the payback period too!

Not sure if the Instant Asset Write Off applies to you? We recommend that you speak to your accountant or advisor to confirm your eligibility.


*Above Article Was Written by a Tax Professional:

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12 Jun 2019

By Sunline Solar Academy