COMMUNITY LIVING
a rebate against their individual tax liability . ‘ This is important , as homeowners will not be paid back immediately but rather on assessment during the 2023 / 24 filing season next year ,’ adds Tucker .
Where a property is leased out , either the landlord or the tenant can apply for the rebate , provided they have permission to install the solar panels , but only the paying party will be able to claim the tax break .
In terms of installation , only new , unused solar panels with a minimum capacity of 275W per panel will qualify for the rebate and they must be installed as part of a new system , or as an extension of an existing system , at a domestic residence ( not at business premises ).
‘ Homeowners will need to provide an electrical certificate of compliance after installation and must ensure that their system is connected to the main distribution board ,’ says Tucker .
Is the tax rebate worth it ?
‘ There is currently lots of uncertainty as to the true benefit to homeowners , and as a result , the uptake may not be as significant as expected by the government ,’ he says .
R50,000 worth of panels between March 2023 and February 2024 , and had them installed and operational during the same tax year , then , under the rebate , they would be able to claim back R12,500 off their tax liability . If their taxable amount is R500,000 for the tax year , without any other deductions , they would have a tax liability of R117,507 . With the solar rebate , they would only be liable to pay R105,007 ,’ he explains .
What else do you need to know ?
As Andrea Tucker , Director of MortgageMe , explains , there are several other requirements that must be met before the rebate can be applied . ‘ The government wants to encourage investment as soon as possible , so this incentive will only be available for one year , and to qualify , you must have purchased the panels between now and 29 February 2024 ,’ she says .
He adds that many South Africans cannot afford to place money on the table for a system thanks to the financial impacts of Covid and now the increasing interest rate hikes . ‘ The availability of solar panels to meet the potential demand would mean that many who would require the tax incentive may miss the window . Added to this , the rebate will only be returned in late 2024 , which is a long time for cash-strapped households to wait ,’ he adds .
It is a sentiment echoed by Henry Fenn , audit supervisor at Hobbs Sinclair Incorporated , who notes that the exclusions far outweigh everything else . ‘ Solar panels without inverters are not worth anything . Components of the solar system – like batteries , inverters , fittings , or portable panels and diesel generators – do not qualify for the rebate , nor do the installation costs . Without a full system it will be less of an incentive and may therefore reduce the appeal ,’ he concludes .
49 S U S T A I N A B I L I T Y
Also important is that the tax incentive is only available to individuals who pay personal income tax and will be claimed as
Zeenat Moosa Hasan