Tax News

Boost Your Solar Savings: New Tax Incentive for Homeowners Unveiled

Published by
WIlliam Dube
  1. The government introduces a solar panel tax incentive for individuals to encourage investment in clean electricity generation and supplement power supply.
  2. Eligible taxpayers can claim a rebate equal to 25% of the cost of new and unused solar PV panels, up to a maximum of R15,000 per individual.
  3. The rebate applies to qualifying solar PV panels installed and brought into use for the first time between March 1, 2023, and February 29, 2024.

The National Treasury has released information on the solar panel tax incentive for individuals, which was announced by the Minister of Finance on February 22, 2023. The initiative is designed to encourage households to invest in clean electricity generation capacity and supplement electricity supply. This article will provide an overview of the incentive’s key features and requirements.

Objective of the Incentive

The government has proposed this one-year program to promote investment in clean electricity generation capacity among households. By making the incentive available for a limited time, the aim is to encourage individuals to invest in solar power as soon as possible.

Eligibility for the Incentive

Individuals who pay personal income tax can claim the rebate against their tax liability. The rebate is not intended for solar installations at business premises. For information on the renewable energy tax incentive for businesses, please see Chapter 4 of the Budget Review.

Rebate Value

Individuals can claim a rebate equal to 25% of the cost of new and unused solar photovoltaic (PV) panels, up to a maximum of R15,000 per individual.

Requirements for Qualification

  • Only new and unused solar PV panels qualify for the rebate.
  • The panels must have a minimum capacity of 275W per panel (design output).
  • Solar PV panels must be installed at a residence mainly used for domestic purposes.
  • Installation must be accompanied by a Certificate of Compliance per the Electrical Installation Regulations, 2009.
  • Solar PV panels must be connected to the mains distribution of the private residence.
  • The rebate applies to qualifying solar PV panels brought into use for the first time between March 1, 2023, and February 29, 2024.

Claiming the Incentive

Individuals can claim the rebate by providing a VAT invoice with the cost of solar PV panels listed separately, along with proof of payment and a Certificate of Compliance. PAYE taxpayers can claim the rebate during the 2023/24 filing season, while provisional taxpayers can claim it against provisional and final payments.

Limitations and Exclusions

The incentive focuses on solar PV panels, excluding diesel generators, inverters, batteries, and installation costs. It is also available to both landlords and renters, but only the party that pays for the solar panels can claim the rebate. The tax incentive does not apply to body corporates.

No Recoupment for Selling Home

Individuals who sell their homes after installing solar PV panels will not have to pay back the rebate to SARS. However, if the panels themselves are sold within one year of being brought into use, a claw-back of the rebate will apply.

Legislation Timeline

The solar panel tax incentive will be included in the annual tax amendments, with a draft version of the legislation expected to be published for public comment no later than the 2023 Draft Taxation Laws Amendment Bill. The Minister will table tax bills during the Medium Term Budget Policy Statement (MTBPS) in October, and the President can assent to the amendments by January of the following year.

WIlliam Dube

William Dube is a finance and economic news expert with over 10 years of experience in economic anaylsis, financial product assessment and market analysis. With a numerous certificates from prestigious universities including but not limited to Yale University and the University of Pennyslivenia. William specializes in providing insightful news developments in South Africa and commentary on investment strategies, risk management, and global economic trends. You can contact him on

Published by
WIlliam Dube

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