Now you could buy things like a ute or replace machinery which is great if you really need these things but buying things you don't need for the sake of a deduction is a bit of a waste.
A commercial solar power system qualifies for the instant asset write off scheme.
- The purchase price comes straight off your taxable income.
- You can purchase as many systems as you like with an individual total under $30k ie if you have 3 industrial sheds you can buy 3 systems and claim the lot.
- You can 100% finance the purchase and still claim the instant tax write-off in 2019 or 2020 financial year.
- The solar system is cash flow neutral so the savings are the same as the finance repayment so system pays for itself.
So a system will save you thousands of dollars in tax, requires no money of your own and pays for itself via savings in power and export power sales.
Here is an example:
Bob's company has a taxable income of $100,000.00
His business has two industrial sheds.
Bob installs 2 x 11.97kw solar systems at $12500.00 ex gst per system
His taxable income is now $75,000.00 saving him around $6000.00 in tax.
He uses 100% finance to purchase at a cost of $321.00 per month per system over 60 months
His power savings and solar export credits are $325.00 per month so covers repayments.*
After 60 months the two systems provide an annual profit of $7800.00 per annum
NB Please consult your tax agent or accountant for professional advice based on your situation before making any decisions. The info above is generic and an example only.
The result for Bob is $6000 more in his bank account from the ATO, using no funds of his own and zero impact on his cashflow. After the finance period he receives a massive profit every year from his systems. Bob does not have to do any extra work, no extra costs it just happens all by itself when the sun comes up. Even with zero power use in his sheds each system will return $3670 per annum* from export power sales. *( using the AGL 20c export tariff )
We don't know of any better option than this. Nothing else you could buy would pan out as good as this. Keep your cash, still claim the deduction, pays for itself from day 1 and massive profits for no effort on your part.
Solaron have been installing quality solar solutions in SE QLD since 2009 with 100% happy clients. You can view our projects, reviews and video testimonials at www.solaron.com.au