Solar Energy Tax Credit in South Africa | South African Tax Help Hub

South Africa’s section 6C solar energy tax credit gave individual taxpayers a credit equal to 25% of the cost of qualifying solar photovoltaic panels, capped at R15,000 per taxpayer, for panels installed between 1 March 2023 and 29 February 2024 (SARS: Solar Energy Tax Credit, 2024). The credit has since expired. Claiming it on a later return is incorrect and may trigger a SARS query.

Key Takeaways

The section 6C credit: 25% of qualifying solar PV panel cost, capped at R15,000 per person.

Valid only for panels installed between 1 March 2023 and 29 February 2024 - the credit has now expired.

Only new, unused panels of at least 275W qualified. Batteries, inverters, and installation costs were excluded.

If you claimed the credit on a 2022/23 or 2023/24 return, keep all supporting documents for at least five years.

What the credit was and when it applied

The section 6C credit was inserted into the Income Tax Act 58 of 1962 as a temporary measure to encourage residential solar investment during South Africa’s load-shedding crisis (legislation.gov.za). It ran for exactly one year of assessment - 1 March 2023 to 29 February 2024 - and has not been extended.

The credit was worth 25% of the cost of qualifying solar PV panels, subject to a maximum credit of R15,000 per taxpayer. This means panels costing R60,000 or more attracted the full R15,000 credit; a R20,000 panel purchase would generate a R5,000 credit. The credit applied to the panel cost only, not to the full system.

What qualified - and what didn’t

Qualifying items:

New, unused solar photovoltaic panels with a minimum generation capacity of 275 watts per panel
Panels must have been installed at a South African residential property used by the taxpayer
The installation date must fall between 1 March 2023 and 29 February 2024

Excluded items (no credit regardless of cost):

Batteries and energy storage equipment
Inverters and charge controllers
Mounting structures, brackets, and racking
Wiring, cabling, and electrical components
Installation labour and project management fees

If your solar installation invoice bundled all components together, only the cost specifically allocated to qualifying panels was relevant for the credit calculation. Where invoices didn’t separate panel costs from other components, SARS expected taxpayers to obtain a breakdown from the installer (SARS: Solar Energy Tax Credit).

Who could claim

The credit was available to natural persons - individual taxpayers, not companies, trusts, or other entities. There was no requirement to be carrying on a trade. A salaried employee who installed qualifying panels at their home could claim the credit on their ITR12 for the 2023/2024 year of assessment.

Complications arose when:

The property had multiple owners (the credit applied proportionally)
Panels were used partly for business purposes (the full credit was not available)
The taxpayer had received a subsidy or rebate from another source that partly covered panel costs

In these cases SARS guidance recommended consulting a registered tax practitioner before claiming.

Records to keep

If you claimed the section 6C credit on your 2023/2024 return, SARS can still query the claim within the standard five-year record-retention period. Keep the following (SARS record-keeping guidance):

Tax invoice from the installer, showing qualifying panel costs separately
Proof of payment (bank statement or EFT confirmation)
Installation date confirmation from the installer
Technical specifications confirming each panel meets the 275W minimum
Any SARS verification correspondence related to the credit
A copy of the ITR12 as filed and the resulting assessment

Current-year caution

Do not claim a solar energy credit on a tax return for the 2024/2025 year of assessment or later. The section 6C credit expired at the end of February 2024. No equivalent credit has been introduced for subsequent years. If you’re unsure which year of assessment applies to your return, check with a tax practitioner or SARS before filing.

Frequently Asked Questions

Can I still claim the solar energy tax credit on my current tax return?

No. The section 6C solar energy tax credit expired on 29 February 2024. It is only available on the 2023/2024 year of assessment. Filing a solar credit claim for any subsequent year is incorrect and may trigger a SARS verification request. Confirm the applicable year with SARS at sars.gov.za before filing.

Did the solar tax credit cover batteries and inverters?

No. Section 6C was limited to the cost of qualifying solar photovoltaic panels only - minimum 275W, new and unused. Inverters, batteries, mounting hardware, wiring, and installation labour were explicitly excluded. The 25% credit applied only to the panel cost itself, so a bundled installation invoice needed to be broken down before the calculation could be done correctly.

How was the section 6C solar tax credit calculated?

The credit was 25% of the cost of qualifying panels, up to a maximum credit of R15,000 per taxpayer. Example: panels costing R40,000 produce a credit of R10,000 (25% × R40,000). Panels costing R60,000 or more hit the R15,000 cap. The panels had to be new, minimum 275W, installed at a South African residential property between 1 March 2023 and 29 February 2024.

What records do I need to keep for a solar tax credit claim already submitted?

Keep the original tax invoice showing qualifying panel costs, proof of payment, installation date confirmation, panel technical specifications, and any SARS verification correspondence. If you received a subsidy or rebate, keep documentation of that too, as SARS may ask whether the cost used for the credit was net of any subsidy. Retain all documents for at least five years from the date of filing.

Sources

SARS: Solar Energy Tax Credit - official guidance, qualifying criteria, and record-keeping requirements
Income Tax Act 58 of 1962, section 6C - the legislative basis for the solar PV panel credit
National Treasury: 2023 Budget Tax Proposals - original announcement of the section 6C credit

Verify the rules for your specific year of assessment with SARS or a qualified tax practitioner before filing any credit claim.