Switching to solar isn't just about reducing electricity bills—it’s a strategic financial decision that can unlock significant tax benefits, protect cash flow, and future-proof your business against rising energy costs. Here’s how solar can work to your financial advantage.
The Australian Government offers an Instant Asset Write-Off, allowing businesses to immediately deduct assets costing up to $20,000. If your business qualifies, you could claim the full cost of your solar system within the same financial year, providing a substantial tax break while reducing your energy costs at the same time.
For larger solar investments exceeding the instant asset write-off threshold, businesses can depreciate the system over its expected lifespan. A $200,000 solar system (ex-GST), for example, could be depreciated at $20,000 per year over 10 years—reducing your taxable income and delivering consistent tax savings year after year. This makes solar a long-term asset with ongoing financial benefits.
Cashflow is king for any business. Instead of an upfront payment, financing your solar system allows you to preserve capital while benefiting from immediate energy savings. Even better, the interest paid on your loan is typically tax-deductible, making solar a low-risk, high-reward investment that doesn’t drain your working capital.
When you purchase a solar system for your business, the GST component can be claimed back as an input tax credit. This means you can reduce your GST liability in the quarter or month of purchase, depending on your business’s GST reporting cycle, improving your cash flow.
Expanding your business often comes with higher electricity bills. But with solar, you’re in control of your energy costs. Rather than being at the mercy of fluctuating electricity rates, solar helps you cap your power costs, allowing for more predictable budgeting as your business grows.
Electricity prices will continue to rise, but solar allows you to hedge against inflation by locking in a fixed cost per kWh. How? By dividing the total cost of your system by the number of kilowatt-hours (kWh) it will produce over the system’s warranty period (typically 10+ years). This gives you a stable and predictable energy cost, helping you plan your financial future with confidence.
These financial benefits are just the beginning. Every business is different, and your accountant can help determine how these tax incentives apply to you. If you’d like to explore how solar can maximise your financial returns, book a call with Lewis from AusPac Solar today.
Solar is more than just an energy solution—it’s a smart financial investment that helps businesses save, grow, and thrive in the long run.
Contact AusPac Solar today to discuss how solar can work for your business.
📞 1300 197 237
📩 sales@auspacsolar.com.au
