Transcript Document

Accelerated Capital Allowance (ACA)

SEAI – Hannes Mac Nulty

What is the ACA?

• It’s a tax incentive (not a grant!) introduced in the 2008 Finance Act • Specifically for companies paying corporation tax.

• Write-off 100% of eligible equipment cost against profit in the first year (normally over 8 years!).

How the ACA works ACA example:

• Company profit = €100,000 • Tax on profit @ 12.5% => €12,500 as standard tax bill • Equipment expenditure = €20,000

Equipment costs deductable from profit Remaining taxable profit: Tax payable on profit:

(@ 12.5%)

Tax saved in year one W/o ACA

€2,500 [

1/8

of total] €97,500 €12,188

€313 With ACA

€20,000 [

8/8

of total] €80,000 €10,000

€2,500

ACA Benefits

ACA Benefits

..and reduces energy costs!

SEAI’s role

Responsibility for maintaining list of eligible products • Develop energy efficiency technology criteria • Administer and check quarterly product submissions by equipment suppliers  List provides Best-in-Class Efficiency Benchmark NB: Products are not Approved or Accredited!

What ACA covers..

10 Equipment Categories

49 Separate Technologies

6000+ Eligible Products

Current ACA Categories

• • •

2008 Lighting Motors & Drives Building Energy Management Systems (BEMS)

• • • •

2009 Information and Communications Technology (ICT) Heating and Electricity Provision Process and Heating, Ventilation and Air conditioning (HVAC) Control Systems Electric and Alternative Fuel Vehicles

New ACA Categories

• • •

2010 Refrigeration and Cooling Electro-mechanical devices Catering and Hospitality

www.seai.ie/aca ACA online

ACA product search facility ACA online

List development

1. SEI receive submissions from suppliers.

2. Products are checked.

3. Supplier must provide documented evidence to demonstrate criteria compliance.

4. Updated list sent for Ministerial sign-off.

5. List published on SEI website

(approx. every quarter).

Claiming the ACA

1. Check item is on the SEI list of eligible products 1. Procure as normal.

2. Ask supplier to record product details as per list on invoice.

3. Claim allowance on annual tax return form.

Claiming the ACA

Claim Value = Cost associated with provision of eligible products

NB:

Provision could be interpreted to include acquisition, transport and installation costs if they are directly related to the provision of the qualifying equipment

Claiming the ACA

Claiming the ACA when no profit is made As is the case for standard capital allowances, the ACA allowances can be carried over to the following year if no profit is made in the year of product purchase.

Triple E Products Register

E xcellence in E nergy E fficiency

Triple E Products Register:

• Adapted from the current list of products eligible for the Accelerated Capital Allowance (ACA) scheme • Register of top 10-15% most efficient products in technology class • Provides a best in class efficiency procurement benchmark based on stringent criteria.

Streamlined procurement and long term energy savings www.seai.ie/tripleE

Thank you

www.seai.ie/aca E-mail: [email protected]