Launch of a new guide for Australian businesses: leveraging tax incentives to improve energy performance

Energy briefing update - December 2021

As Australian businesses recover from the first recession in thirty years, cost management has become more important than ever. The Australian Government’s new and expanded tax incentives, which were released as part of a broader suite of stimulus measures to boost the economy as it recovers from the COVID-19 pandemic, mean that the time is ripe to invest in energy upgrades that deliver ongoing financial savings and boost productivity. The new guide, Leveraging tax incentives to improve energy performance, is an easy-to-understand explainer of how businesses can make investment in smart energy management more attractive by utilising the tax incentives.

The new and expanded tax incentives provide businesses with an unprecedented opportunity to immediately deduct the full cost of eligible assets. You can also deduct the full cost of improving existing depreciating assets. Businesses can leverage these tax incentives to make strategic investments that drive major productivity improvements in their operations, the kind of changes that may not have been feasible without the savings from these measures.

The Australian Government has made available several tax incentives for the purpose of acquiring or improving depreciating assets, including:

·       Temporary full expensing;

·       Instant asset tax write-off; and

·       Backing business investment - accelerated depreciation.

These measures enable almost all businesses in Australia to be able to write off the full value of eligible assets, ranging from machinery and equipment to computers and more. Each of these measures have specific applications and eligibility criteria for businesses and assets that are easily explained in the guide, with more detailed information linked on the Australian Taxation Office’s (ATO) website.

You can read the guide now, but if you're keen to learn more, join the EEC and Business Australia will be hosting a webinar in early 2022 to unpack how the current tax depreciation incentives make investing in improving energy management a financially and strategically smart decision.
Learn more here.

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