Small businesses get $325 in energy assistance Starting July 1, 2024

Over the course of 2024-25, about one million small businesses will get $325 in energy cost reductions. The assistance will be paid as an automated quarterly credit on energy bills.

Households will also get a $300 reward for energy savings.

The plan, which costs $3.5 billion over three years from 2023 to 2024, continues and increases the Energy Bill Relief Fund. 

 

$20k small business instant asset write-off date has been extended from July 1, 2023 to June 30, 2025.

Small businesses with an aggregate annual revenue of less than $10 million will be allowed to immediately deduct the entire cost of qualified depreciating assets costing less than $20,000 that are first utilised or installed ready for use between July 1, 2023 and June 30, 2025. This bill extends the Budget announcement for 2023-24 to the fiscal year 2024-25.

“Immediately deductible” indicates that the tax deduction for the item may be claimed in the same income year in which it was acquired and utilised (or installed and ready for use).


If the firm is registered for GST, the asset’s cost must be less than $20,000 after deducting any GST credits that may be claimed. If the company is not registered for GST, it is less than $20,000 including GST.

The write-off applies per asset, allowing a small business to deduct the cost of many items.

The regulations only apply to assets that come under the depreciation requirements. Expenditure on capital enhancements to buildings that come under the capital works regulations is not likely to qualify.

Assets worth $20,000 or more, which cannot be immediately deducted, can be depreciated at 15% in the first year and 30% in subsequent years if acquired by a small business entity following the simplified depreciation rules.

The measures that prohibit small enterprises from returning to the simplified depreciation system for five years if they opt out would be delayed until June 30, 2025.

The higher small company immediate asset write-off stated in the 2023-24 Federal Budget has not yet become legislation (see Treasury Laws Amendment (Support for Small company and Charities and Other Measures) Bill 2023). Senate amendments recommended raising the barrier from $20,000 to $30,000 and widening the measure to include medium-sized enterprises. 

 

The Future Made in Australia Initiative 

The government has proposed an aggressive ambition to transform Australia into a “renewable energy superpower.” 

The $22.7 billion series of initiatives is intended to foster and encourage significant private sector investment in priority industries required to reap the economic and industrial benefits of the nett zero transition and secure Australia’s position in a changing global economic and strategic landscape. 

The Future Made in Australia Act will establish the policy framework, with a focus on industries in which Australia has a genuine economic advantage, where it contributes to an orderly path to nett zero, where it builds on people and region capabilities, and where it improves Australia’s national security and economic resilience. 

 

Making Australia a renewable energy super power. From 2027–28 to 2040–41

As part of the Future Made in Australia initiative, the government will invest an estimated $19.7 billion over ten years, from 2024-25, to accelerate investment in Future Made in Australia priority industries such as renewable hydrogen, green metals, low carbon liquid fuels, critical mineral refining and processing, and clean energy technology manufacturing, including in solar and battery supply chains.

Two time-limited tax incentives are available to encourage investment in new sectors:

• Important Minerals Production Tax Incentive: From 2027-28 to 2040-41, the incentive will promote downstream refining and processing of Australia’s 31 important minerals, therefore improving supply chain resilience.
• The production incentive will cover 10% of processing and refining expenses for up to 10 years for projects that achieve final investment decisions by 2030.
• A Hydrogen Production Tax Incentive for Renewable Hydrogen Producers from 2027-28 to 2040-41 to assist the creation of a competitive hydrogen sector and Australia’s decarbonisation.
  • The incentive will be $2 per kilogram of renewable hydrogen generated for up to ten years per project between 2027-28 and 2039-40 for projects that make final investment decisions by 2030.
  • Details will be determined after consultation.

The tax breaks are scheduled to be in effect from 2027-28 to 2040-41.

 

Funding Measures

The government is getting involved with business to get people to invest in certain areas:

• $10.2 million in 2024–25 for pre-feasibility studies for critical mineral common-user processing facilities. These will be done with the help of the state and territory governments to improve Australia’s ability to handle critical minerals, its ability to be an independent nation, and its economic stability.
• $1.3 billion over ten years, from 2024–25, and an average of $151.6 million per year from 2034–35 to 2038–39 for an extra round of the Hydrogen Headstart programme, which will help early-mover sustainable hydrogen projects pay for themselves.
• $17.1 million over four years, starting in 2024–25, plus an extra $2.5 million in 2028–29, to carry out the 2024 National Hydrogen Strategy. This includes planning for hydrogen infrastructure, getting a social licence, and training and rules for industry safety.
• $1.5 billion will be given over seven years, starting in 2027–28, and will be a steady $125.0 million per year from 2034–35 to 2036–37 to the Australian green Energy Agency to spend in green energy and related technologies.
• $1.7 billion over ten years, from 2024–25, for the Australian Renewable Energy Agency’s Future Made in Australia Innovation Fund, to early stage development and pilot and demonstration projects in priority areas including renewable hydrogen, green metals, low carbon liquid fuels, and the manufacture of clean energy technology like batteries.
• $1.4 billion over 11 years, starting in 2023–24, and $66.8 million a year from 2034–35 to 2036–37, to help make clean energy tools like solar panels and batteries.
• $20.9 million over four years, starting in 2024–25, plus $1.2 million a year after that to keep talking about ways to encourage the production and use of low-carbon liquid fuels.
• $18.1 million over six years, starting in 2024–25, for basic projects that will help Australia’s green metals business get off the ground faster.
• $11.4 million over four years, starting in 2024–25, plus $1.1 million a year after that to speed up the first part of the Guarantee of Origin Scheme for green hydrogen and work on green metals like iron, steel, and aluminium.

 

From the income year 2025-26, film producers will receive a tax offset

When certain circumstances are satisfied, the Producer Tax Offset is a refundable tax credit for Australian spending spent on film production in Australia. The offset covers:

• 40% of the company’s qualified Australian production expenditure (QAPE) for a feature picture.
• 20% of the company’s total QAPE for a non-feature film.

The minimum time needed varies based on the format of production.

As part of the government’s declared National Cultural Policy, it will make the amendments to the Producer Tax Offset in 2025-26 to eliminate.

• Minimum duration requirements for content
• The above-the-line limit is 20% of the total QAPE.

 

Small Business Support Services Over four years, from 2024- 2025

The government has pledged $41.7 million in financing over four years from 2024-25 for a number of projects to promote small businesses: 

• Improving payment times for small businesses, including naming and shaming: increased funding for the Payment Times Reporting Regulator so that it may carry out its expanded tasks, including identifying slow paying businesses.
• Mental health and financial well-being of small company owners:
  • Extending the NewAccess for Small Business Owners programme, which offers personalised, free, and confidential mental health help. 
  • Extending the Small Business Debt Helpline. 
• In response to the 2023 Schaper Review of the Franchising Code of Conduct, the Government will provide $3 million to:
  • Remake and enhance the code.
  • Promote best practices for franchisors and franchisees.
  • Make it simpler for small firms to operate in the industry by improving access to dispute resolution.
• Access to justice: $2.6 million in support for the Australian Small Business and Family Enterprise Ombudsman. The ASBFEO supports and advocates for small companies, including resolving conflicts.