Sitting down with my coffee and digital subscription to The Economist a few days ago, I was finding it more difficult than usual to focus. While I was reading a stimulating piece on how COVID-19 has exposed major flaws in Germany’s biggest firms, I realised I was ruminating about the pandemic. Again.
One thought that has kept me awake at night is how governments around the world are balancing between keeping citizens safe and keeping the economic engines of the country running, during this time.
Lost in my thoughts – including strategising what I would do if I was in their position – my coffee had turned lukewarm (don’t you just hate it when that happens?).
While my coffee reheated, I turned over some of the moves made by the government to help businesses during this lockdown, in my head. Their recent announcement on the increase in the instant asset write-off was a surprising (and entirely welcome) move – especially for businesses who have struggled to go green.
Given the work I do, I meet numerous businesses and people who tell me that while they would love to make green energy a bigger part of their homes or offices, it’s simply too expensive to commit to at that moment.
While this is something I empathise with, I’m always trying to convince people to make the leap of faith and experience the benefits of solar power systems – especially, commercial solar solutions – in monetary terms. Who wouldn’t want a renewable energy source on their roof top?
With the government announcing an instant asset write-off period between the 12th of March and the 30th of June, I thought I’d pen down a few thoughts for businesses contemplating what their next move should be and why commercial solar power systems are a (green) thumbs up.
What are the terms of the recently increased instant asset write-off?
In layman’s terms, an instant asset write-off is where eligible businesses can write off the cost of an asset that costs less than the threshold value, which, in Australia’s case, was recently increased to $150,000.
It is essentially a tax deduction for the business portion of the purchase cost in the year the asset was first used or installed.
To help businesses who are struggling as a result of COVID-19, the government increased the original claim amount, which was $30,000, to its present limit. The only catch is that it needs to be claimed during the stipulated period (hurry up, folks!).
The government has also generously expanded its coverage to include businesses with an aggregated turnover of less than $500 million.
What does this mean for businesses who want to go green?
If commercial solar systems have been on your mind for some time, now is arguably the best time to make your move.
While COVID-19 has severely impacted our sources of revenue and really forced us to think hard on what our priorities are, a write-off increase can help you make a strategic, long-term decision without taking a hit to your cash flow.
A few businesses have reached out to me during this time and inquired about using the instant asset write-off to get their commercial solar power system installed. I’m really blown away by how far ahead they’re thinking because, write-off aside, solar power systems help you make the money you spend back in terms of substantial energy savings.
Moreover, with the right maintenance and care, solar systems are a long-term investment, which generates savings over their lifetime. As far as business assets go, they are among the most valuable because they cut down on a major operational cost and help you embrace a greener, cleaner, and more sustainable company culture.
Think strategically about commercial solar solutions during the instant asset write-off period.
Helping your company sail through the uncharted waters of a pandemic is a novel challenge for our generation. There are no rule books, guides or maps on what the right direction is. One thing stands true: What you do now affects how your business performs in the post-COVID-19 environment.
Commercial solar solutions are a forward-thinking investment. I say this is because they prepare your company for a future of uncertainty and a future in which we need to remain as efficient as possible.
After all, is there anything more cost and energy-efficient than a renewable energy source mounted right on top of your roof?
See how much your roof could be worth using our Free Solar Savings Calculator here.