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Germany approves tax benefits for small solar installations.

By January 2, 2023August 24th, 2023No Comments
Germany Approves Tax Benefits for Small Solar & Battery Systems

The German Bundestag has approved a number of tax breaks for small photovoltaic (PV) and energy storage (batteries) systems to encourage the use of solar energy on the roofs of residential and commercial buildings across Germany. The changes are part of the 2022 Tax Act that Congress passed on Friday. The VAT rate will be deducted automatically for German visitors of our Shop.

According to the new tax law, operators of small solar power plants will not have to pay income tax or transaction tax on their income from the feed-in tariff for solar power. The tax relief is retroactive to January 1, 2022 for single-family residential and commercial photovoltaic (PV) and battery systems up to 30 kWp. For multifamily and mixed-use buildings, the exemption applies to solar systems up to 15 kWp per residential or commercial unit but is limited to up to 100 kW per taxpayer.

Furthermore, from 1 January 2023, the 19% VAT on the purchase and installation of solar PV systems, including storage batteries, will no longer apply. The VAT exemption also applies to systems ordered in 2022 but put into operation next year. Tax incentives should save the buyers some money when purchasing a new solar system. More info Here

Many ECO activists welcomed this new law and said that this new tax exemption for private solar systems would give many homeowners the long-awaited incentive to invest in solar energy, taking into consideration that there is the sheer amount of bureaucracy associated with tax returns for income from solar power that has prevented many homeowners from installing their own solar power system.