So, are you seriously thinking about installing solar panels? Great idea, especially since it not only boosts your ecological karma, but can also lighten the tax bill! Yes, several financial aids are available to encourage this approach. Today, we decipher all of this in a simple and friendly way to help you see clearly in the maze of solar aids.
Goodbye Tax Credit, Hello MaPrimeRénov’ and other aids
Well, bad news to start with: the famous tax credit for solar installations is a thing of the past. Since 2020, it has disappeared to make way for MaPrimeRénov’. But don’t panic, because this system is still very cool for reducing costs. The principle is simple: you install solar panels on your roof, you produce your own energy, and the State sends you a direct financial aid, adjusted according to your income and the power of your installation. It doesn’t cover everything, but it gives a good boost!
Reduced VAT, Zero-Rate Loan: Other Ways to Reduce the Bill
With solar panels, you can also benefit from a reduced VAT rate of 10% if your installation is 3 kWc or less. The smaller it is, the less you pay! In addition to that, the zero-rate loan allows you to finance the installation of your panels without interest. The amount depends on the work you plan. Imagine: zero interest and reduced VAT, that’s a good start, right?
Another option for low-income households: the energy voucher. It can go up to €277 per year, and allows you to help pay your bills or energy efficiency work. It’s a nice bonus, which can be added to the other aids.
Income Tax Exemption: For Small Energy Producers
If your solar installation has a power of 3 kWc or less, good news: you will not be taxed on the income from selling your electricity. In short, if you sell your surplus (or all your production) to the grid, you earn income without passing through the tax authorities. It becomes interesting if you consume little and sell a lot. On the other hand, as soon as you go beyond 3 kWc, there, you will have to pay taxes on your income.
To declare all this, you need to use form 2042 C PRO. It may seem a bit boring, but it’s super simple and fast. And then, for installations below the threshold, you just have to declare without paying any tax.
Little Pitfalls to Avoid When Equipping Yourself with Solar Panels
Before you go, a few things to know to avoid unpleasant surprises. First, know that if you want to install panels on the ground rather than on your roof, your property tax could increase. Yes, on the roof, they are considered as part of the house; on the ground, it’s an additional installation.
Also, if you embark on selling energy, choose your tax regime wisely. The micro-BIC regime is an option, with a 71% deduction from income. That said, if your income is substantial, find out about the simplified actual regime, which even allows you to recover VAT.
Another Helping Hand: The Denormandie Law and the Property Deficit
If you own a rental property and install solar panels there, you can also take advantage of the Denormandie law and the property deficit to decrease your tax. The Denormandie law gives you a tax reduction in exchange for renovating a rental property in certain areas. And the property deficit? It’s simple: if your expenses related to your rental property exceed the income generated, you can deduct the difference from your overall income up to €10,700 per year.
In Short, Solar Installation: A Smart, Eco-Friendly and Fiscally Advantageous Investment
Solar panels are not only a way to help the planet. Properly installed, they can really simplify your financial life. Between MaPrimeRénov’, tax exemption for small producers, the energy voucher and even the VAT advantage, there is plenty to make it work. Add to that the schemes for landlords, and it becomes a choice solution.
So, ready to take the plunge?
Curious to learn more? Read this article!
