Businesses that purchase ‘green’ Information and Communications Technology equipment can make substantial savings as 100 per cent of the capital cost of such energy efficient equipment can be written off against their taxable income in the year of purchase. Significantly businesses will also save on energy costs reduced by the use of more energy efficient equipment.
Information and Communications Technology equipment is to fall under the ambit of the Accelerated Capital Allowance scheme (the ‘’ACA’’), as announced by Sustainable Energy (‘’SEI’’) on 30 April 2009. The ACA is a tax incentive scheme that was introduced by the Government under the National Development Plan 2007-2013 to encourage companies to invest in energy-efficient or ‘green’ equipment. Section 44 of the Finance Bill 2008 provides the legal basis for this scheme.
The products that qualify under the ACA were expanded upon by Section 37 of the Finance Act (No. 2) 2008 to include:
- Information and Communications Technology (‘’ICT’’);
- Heating and Electricity Provision;
- Process and Heating, Ventilation and Air-conditioning Control Systems and
- Electric and Alternative Fuel Vehicles.
The ICT product categories includes Enterprise Servers, Enterprise Storage Equipment, Precise Cooling products, Heat Rejection producers, Power Management and Uninterruptible Power Supply equipment.
To avail of this scheme a company must ensure equipment purchased is eligible under the ACA qualified products list. SEI is accepting submissions under these four areas until 5 June 2009 which will then be considered over the following 6-8 weeks for eligibility to be listed on the ACA Specified List which can be viewed at www.sei.ie. This list is expected to be updated quarterly.
The Taxes Consolidation Act 1997 (Accelerated Capital Allowances for Energy Efficient Equipment) Order 2009 stipulates the legal requirements under which products shall be considered and deemed energy efficient as appropriate.