The Federal Budget is just around the corner, and Treasurer Jim Chalmers is following the tradition of many of his predecessors by drip-feeding early details due to be delivered in full on Wednesday 10 May.
The latest tidbit of information is the launch of a Small Business Energy Incentive designed to help up to 3.8 million small‑ and medium‑sized businesses cut their energy costs – or as Treasury puts it “propel their energy transformation”.
The Small Business Energy Incentive works by providing a 20% bonus tax deduction when businesses with annual turnover below $50 million invest in electrification and more efficient use of energy.
Some of the spending Chalmers has in mind includes electrifying your business’s heating and cooling systems, upgrading to more efficient fridges and induction cooktops, and installing batteries and heat pumps.
Up to $100,000 of total expenditure will be eligible for the Small Business Energy Incentive, with the maximum bonus tax deduction being $20,000 per business. Eligible assets or upgrades will need to be first used or installed ready for use between 1 July 2023 and 30 June 2024.
The Federal Treasury suggests this new tax break will benefit small business operators including real estate agents, tradies, manufacturers, restaurants, and hairdressers. But Cameron Poolman, CEO of OnDeck, says there is a whole community of small businesses that may be able to take advantage of the savings on both power and tax offered by the Small Business Energy Incentive.
OnDeck Australia CEO Cameron Poolman
Poolman explains, “OnDeck’s own research tells us that two out of three small businesses are feeling the shock of rising electricity bills, and one in four are finding that high power bills are having a greater impact on profitability than fuel costs or the rising cost of trading stock. So I have no doubt, many small businesses will be eager to tap into the Small Business Energy Incentive.
Of course, it’s one thing to get a tax break for investing in more energy-efficient plant and equipment – the challenge for small businesses can be finding the money to pay for it all.
That’s where OnDeck can help. OnDeck’s fast, efficient funding allows small businesses to act quickly and with certainty when they find equipment that is fit for purpose.
“When I speak with OnDeck customers, it’s clear to me that the small business community is ahead of the curve when it comes to exploring opportunities for energy efficiency,” says Poolman. “And I expect the new Small Business Energy Incentive will further encourage small businesses to upgrade or replace energy-guzzling plant and equipment.
“With power bills set to surge, I encourage all small businesses to speak with OnDeck about funding that allows the enterprise to tap into the Small Business Energy Incentive – and cut energy costs as well as their tax bill.”
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