0% Vat on solar panels

Is there 0% Vat on solar panels?

Goods news, the answers is Yes. The government has just announced some amazing changes that are sure to change the game for solar panel installation in the country. From May 1st, 2023, there will be a VAT reduction from the current 13.5% down to a flat zero percent rate. This change is sure to have a ripple effect that will leave many consumers feeling very happy. Not only is this great news for the environment, but it means that consumers can now purchase solar panel installations at a reduced price. This can produce a potential saving of up to €1,200. With the average payback period also being reduced by nearly a year, from 7 years to 6.2 years, there is no better time than now to take advantage of this fantastic opportunity. For more information visit Revenue.ie or get in touch with Blackwell Energy to find out more about how you take the first steps towards a greener future

Whats a private dwelling?

Starting May 1, 2023, there’s now a zero rate for the supply and installation of solar panels on private dwellings. Private dwellings include many types of houses, apartments, duplexes, and other types of immobilised mobile homes that are effectively attached to the ground. . Solar panels can include photovoltaic panels, solar windows, and solar walls.This gives the public a fantastic opportunity to save money on solar panel installations

How does it all work ?

In order for the zero rate to apply, the responsibility for supplying the solar panels and installing them must lie with the same business in the same contract. In cases where there is no installation contract in place, the standard rate applies to the supply of the solar panels. However, a separate installation contract may still be eligible for the reduced rate, as long as the cost of the goods used in the installation exceeds two-thirds of the total price. If the two-thirds rule applies, then the rate that applies to the goods will apply to the entire transaction. It is important to note that the zero rate is not applicable to installations on or adjacent to moveable structures such as boats or mobile homes.

Example, Company A supplies solar panels without installing them and is subject to the standard rate, while Company B supplies and installs solar panels on private dwellings and is subject to the zero rate. In the case of Company C, they subcontract the installation to Company Y and are still eligible for the zero rate for their supply and installation of solar panels, while Company Y is liable for the reduced rate for their installation services. Taking advantage of this reduction along with the SEAI grant makes going solar a whole lot easier

Commercial buildings

In the case of commercial buildings, if the solar panels are provided as part of a “supply and install” contract, where building services are provided alongside the necessary goods for the project, the supply may qualify for a reduced rate of vat. However, the two-thirds rule.

What is the two-thirds rule? If the value of the solar panels and other goods supplied does not exceed two thirds of the total value of the contract, then the full amount payable under the building contract will be subject to the reduced rate of tax. However, if the value of the goods exceeds this threshold, the standard rate of tax will apply.

For example, if Company D were to supply and install solar panels on a commercial building, and the value of the panels and other goods does not exceed the two-thirds rule, then they would be eligible for the reduced rate of tax.

Blackwell Energy, bringing affordable solar solutions to homes and business

0% Vat on solar panels

Is there 0% Vat on solar panels?

Whats a private dwelling?

How does it all work ?

Commercial buildings

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