Tax Breaks and Solar Power Incentives for UK Citizens

There are lots of praises being sung by owners of solar panels about their benefits. These benefits revolve around the sustainable nature of the panels as well as the renewable energy they produce. Solar panels are also reducing light bills down to the point where it feels like you’re getting electricity for free.

However, one particular feature that causes UK residents to grumble is the money-sapping cost of installing these panels. Although you don’t pay anything after installing solar panels, you’ll more than feel the impact of the initial costs.

So what happens then? Well, luckily the UK is fortunate to have certain tax breaks and solar panel incentives in place that make life easy for you and your wallet.

Solar Power Tax Incentives Worth Looking Out For

1. 0% VAT Reduction

Typically, the Value Added Tax, also known as VAT, was set at 20% across the UK for goods and services. As time went on, this was reduced to 5% for home and energy services. Now, this has gone all the way down to 0% and that comes at a very good time too.

You see, for 5 years starting from 2022, the VAT will be fixed at 0% on all energy-efficient services. That means that buying solar panels as well as their installation falls under this incentive.

2. Smart Export Guarantee

The goal here is to provide incentives to consumers who produce more energy than they consume. In essence, if you use solar panels and the electricity you generate is more than what you consume, licensed energy suppliers will have to pay you in exchange for the excess energy supplied to the grid.

This is similar to a cashback system that solar panel owners will love and appreciate.

3. Energy Company Obligation 4

This is similar to the Smart Export Guarantee system but with more flexibility. It also aims to provide grants and savings to solar panel customers. That way, homeowners can benefit from buying and installing solar panels in their homes and offices.

Unlike the SEG, the criteria for qualifying for ECO4 aren’t fixed but instead, vary from one council to another. In essence, multiple households can qualify for the incentive and benefit from the savings granted.

Useful Tips For Saving Money On Solar Panels

• Be thorough in your search for the right solar panels. Always seek quotes from multiple sources and use them to learn the average price of solar panel installation
• Ensure you acquire only the right size and amount of solar panels needed for a profitable investment
• Be sure to seek assistance from only certified professionals when installing solar panels
• Always have a solar panels savings calculator handy to estimate exactly how much energy you’ll be using compared to the amount generated by the panels

Conclusion

Solar panels are already known to improve the way UK residents generate and consume power. In addition to that, these panels come with incentives from the government that enhance their productivity and efficiency. Hence, you must have an idea of these incentives so you can improve your power usage.