TAX BREAKS ON SOLAR
Hello Everyone
In the Budget speech, Finance Minister announced that R4 billion in relief provided for individuals that install solar panels and R5 billion to companies through an expansion of the renewable energy tax incentive.
Let us unpack this relief for individuals!
This is a rebate and thus will be deducted after taxable income. This is not for your inventor installation or batteries but only for the solar panels.
This rebate will be effective from the 1 March 2023 and is only valid for the 2024 tax year.
Individuals will be allowed to deduct 25% of the cost of the solar panels, up to R25,000. If you spent R60,000 on your solar panels, then you will be allowed to deduct R15,000.
What are the terms and conditions
- The solar panels must be new or unused PV panels thus ensuring additional capacity to what the country already has in place. If you already have solar panels, this will not qualify.
- Only solar PV panels with a minimum capacity of 275W per panel (design output) qualify for the rebate.
- As mentioned, the other components, such as batteries, invertors, fittings and even portable panels will not qualify
- Solar PV panels must be installed at a residence that is mainly used by an individual for domestic purposes. The installation will have to be proved with a certificate of compliance in terms of the Electrical Installation Regulations, 2009 to ensure safety of the installation and compliance to electric regulations. Do electricians currently stipulate this on the certificate of compliance? No. They will have to stipulate that the solar panels meet the compliance standards.
- The solar PV panels must form part of a system that is connected to the mains distribution of the private residence
Hope this adds value in making your solar decision 😊
