PV SOLAR question for our TAX fundies





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  1. #1
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    Default PV SOLAR question for our TAX fundies

    If I run a home office for my Pty Company. It occupies a fair amount of real estate and the lions share of my daily electricity bill.

    Can I get the company to pay for a PV Solar Installation.
    Cheers

    ZS5KAD
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    The frogs are starting to notice that the water is getting warm but it is already too hot to do anything about it.....

  2. #2
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    Yes. As it is a capital expense it must be capitalised and wear and tear can be claimed and written of taxable income. Pro rata private use will be disallowed.
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  3. #3
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    Quote Originally Posted by Hollebollegys View Post
    Yes. As it is a capital expense it must be capitalised and wear and tear can be claimed and written of taxable income. Pro rata private use will be disallowed.
    Most PV Solar installation are just a cash flow problem.

    It's pretty easy to justify the just from a savings point of view over their lifespan.

    Instead of drawing dividends, I absorb part of the companies profit to pay for the PV system.

    In the end all I am doing is reducing my own dividend payout, so I am paying for the PV anyhow, but in return I am getting the benefit of PV for the tax savings on my dividend.

    mmmm, doesn't sound such a good idea any more. I need to do the calculations.
    Cheers

    ZS5KAD
    3 V8's
    NA TwinTurbo SuperCharger
    A V6 and an inline 4

    The frogs are starting to notice that the water is getting warm but it is already too hot to do anything about it.....

  4. #4
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    Quote Originally Posted by Hollebollegys View Post
    Yes. As it is a capital expense it must be capitalised and wear and tear can be claimed and written of taxable income. Pro rata private use will be disallowed.
    Thank you for that.

    I wonder if anybody else has done or tried to do this.
    Cheers

    ZS5KAD
    3 V8's
    NA TwinTurbo SuperCharger
    A V6 and an inline 4

    The frogs are starting to notice that the water is getting warm but it is already too hot to do anything about it.....

  5. #5
    Join Date
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    just remember - when you sell the house you will probably sell the PV with the house.

    The day you sell, part of the purchase price could be allocated to the PV system - this means you could potentially realise a recoupment (profit on the sale of the PV) for tax purposes.

    Just so you have all the facts...

    Maybe also check out whether you can apply section 12L. Since you are well versed in things electricity related - it should be easy to establish a baseline.

    12L. Deduction in respect of energy efficiency savings.—(1) For the purpose of determining the taxable income derived by any person from carrying on any trade in respect of any year of assessment ending before 1 January 2020, there must be allowed as a deduction from the income of that person an amount in respect of energy efficiency savings by that person in respect of that year of assessment determined in accordance with subsection (2), subject to subsection (3).(2) The amount of the deduction contemplated in subsection (1) must be calculated at 45 cents per kilowatt hour or kilowatt hour equivalent of energy efficiency savings.
    (3) A person claiming the deduction allowed in terms of subsection (1) during any year of assessment must obtain a certificate issued by an institution, board or body prescribed by the regulations contemplated in subsection (5) in respect of the energy efficiency savings for which a deduction is claimed in respect of that year of assessment containing—
    (a) the baseline at the beginning of the year of assessment;
    (b) the reporting period energy use at the end of the year of assessment;
    (c) the annual energy efficiency savings expressed in kilowatt hours or kilowatt hours equivalent for the year of assessment including the full criteria and methodology used to calculate the energy efficiency savings; and
    (d) any other information prescribed by the regulations contemplated in subsection (5).
    (4) A deduction must not be allowed in terms of this section if the person claiming the allowance receives any concurrent benefit in respect of energy efficiency savings.
    (5) The Minister of Finance, in consultation with the Minister of Energy and the Minister of Trade and Industry, must make regulations prescribing—
    (a) the institution, board or body that must issue the certificate contemplated in subsection (3);
    (b) the powers and responsibilities of the institution, board or body contemplated in paragraph (a);
    (c) the information that must be contained in the certificate contemplated in subsection (3) in addition to the information contemplated in that subsection;
    (d) those benefits that constitute concurrent benefits for the purpose of subsection (4); and
    (e) any limitation of energy sources in respect of which the allowance may be claimed.
    Last edited by Brand2011; 2015/03/02 at 08:34 PM.
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