Solar incentives for business
Commonwealth Instant Asset Write -Off
Do you qualify for generous tax treatments for rooftop solar?;
The Commonwealth Government introduced an allowance that will directly support companies to invest in solar energy assets.
Businesses with an annual turnover of up to $500 million are able to immediately deduct several assets as an instant asset write off. This includes new and second hand plant and equipment worth up to $150,000 each.
Businesses with a turnover of up to $5 billion will be able to immediately deduct the full cost of a new, eligible asset installed or ready for use by 30 June 2022, with no limit on asset value. These measures can help build the case for companies that wish to invest in solar and energy productivity enhancing equipment.
Installing solar PV panels on rooftops for business energy use or a solar battery for energy storage can qualify as an instant asset under this scheme.
For further information, refer to the Australian Tax Office website
Commonwealth Small Scale Renewable Energy Scheme
The Federal Government solar rebate scheme for solar systems under 100kW in size is known as the small scale renewable energy scheme.
For each kilowatt of panels you install, a certain number of small-scale technology certificates (or STCs) are generated. Because these STCs are bought by electricity retailers who need them to meet their renewable energy obligations, you receive money for each certificate.
You can expect to sell each STC for about $30. For a 30kW system, this equates to approximately $18000 off the cost of the system. Most solar quotes you’ll see will already have the STC discount applied, so unfortunately you can’t claim an additional $18,000 off the price.
This process is entirely managed by your solar installer, so there’s no need to worry about selling the STCs yourself (though it’s an option if you’d like to do so).
It’s important to note that this scheme is currently being phased out until 2030, with the value of STCs declining by 7% at the start of each calendar year (January 1st).
Eligibility requirements
- Small scale Technology Certificates (STCs) must be created within 12 months of installation
- The project must use Clean Energy Council approved inverters and solar panels
- The solar system must have a maximum 100kW DC capacity (nameplate rating of solar panels not inverter)
- The solar system must adhere to local, state, federal government legislation and Australian standards.
The following projects ARE eligible for STCs if the total system remains under 100kW in capacity:
- creating additional capacity or upgrading
- installing an additional separate system, and
- replacing an additional system
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