Unlocking Savings: What You Need to Know About the Small Business Energy Incentive
Updated: Sep 29
Small Business Energy Incentive: Save on Power Bills & Go Green
The Small Business Energy Incentive is now law—and it’s a game changer. Designed to cut energy bills and reduce emissions, this federal initiative helps small businesses invest in energy-efficient upgrades and claim bonus tax deductions through the ATO. If your business is ready to upgrade lighting, install solar, or improve insulation, this is the time to act.
What Is the Small Business Energy Incentive?
The Small Business Energy Incentive provides an additional 20% bonus tax deduction on eligible energy-efficient assets or improvements. It aims to:
Support small businesses in reducing power usage
Lower operating costs
Encourage sustainable business practices
Incentive period: Applies to eligible assets first used or installed between 1 July 2023 and 30 June 2024.
Who Qualifies?
To access the incentive, your business must:
Have an annual turnover of less than $50 million
Be actively trading and operating in Australia
Be fully compliant with the ATO (lodgements and payments up to date)
If you meet these criteria, you’re eligible to claim deductions for eligible energy-efficient assets.
Eligible Investments
The incentive applies to depreciating assets that help improve energy efficiency. These include:
✅ LED Lighting
✅ High-efficiency air conditioning or refrigeration
✅ Solar power systems
✅ Energy monitoring and control systems
✅ Battery storage
✅ Electric heat pumps or hot water systems
✅ Improved insulation or building management systems
Note: Cars and other vehicles are excluded from the scheme.
How to Apply: Step-by-Step
Confirm Eligibility - Check your turnover, trading status, and ATO compliance.
Purchase Qualifying Assets - Make sure the equipment is energy-efficient and meets criteria.
Install & Use by Deadline - Assets must be installed and ready for use between 1 July 2023 and 30 June 2024.
Maintain Proof - Collect receipts, product specifications, and installation certificates.
Claim the Bonus Deduction - Submit your tax return through your accountant, including the additional deduction.
Key Compliance Requirements
To stay eligible:
Keep clear records of purchases, installation, and energy specs
Ensure all ATO obligations are met
Use certified energy-rated products (check with your supplier)
Benefits to Your Business
Immediate Cost Relief - Lower electricity bills and reduce operating costs
ATO Tax Savings - Claim a 120% deduction on eligible expenses
Sustainable Practices - Show your customers you're serious about carbon reduction
Future-Proofing - Get ahead of future energy cost hikes and environmental regulation
Make It Count with Dolman Bateman
Need help navigating the tax claim or choosing eligible equipment? At Dolman Bateman, we specialise in maximising tax incentives for Australian businesses. Call us on 02 9411 5422 to ensure you don't miss out on this valuable opportunity.
Disclaimer: The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. All content relates to the current financial year only. Future changes to tax laws, thresholds or administrative requirements may affect the accuracy or relevance of this information, so you should always confirm that the guidance remains current. While every effort has been made to ensure accuracy at the time of publication, Dolman Bateman accepts no responsibility or liability for any loss or damage arising from reliance on this information. You should seek professional advice tailored to your circumstances before making any financial or tax decision.
