Photovoltaic systems: new regulations in detail
Photovoltaic systems
Income from the sale of electricity generated by a photovoltaic system to the local grid operator constitutes income from commercial operations (§ 15 of the German Income Tax Act/EStG). In addition, the operation of a larger photovoltaic system also incurs sales tax, unless the operator falls under the small business regulation (sales in the previous year not exceeding € 22,000.00 and in the current calendar year no sales exceeding € 50,000.00, cf. § 19 para. 1 Umsatzsteuergesetz/UStG). Operators of larger facilities must also submit a trade tax return if the trade income exceeds the exemption amount of € 24,500.00 per year.
New regulations in the JStG 2022
Up to now, the tax authorities have granted operators of smaller plants a waiver of taxation upon application. This meant that small systems could be exempted from taxation, but the acquisition costs were not depreciable. This was possible for systems up to 10 kilowatts (cf. BMF letter dated 29.10.2021). With the Annual Tax Act 2022, Section 3 No. 72 EStG as amended by JStG 2022, a statutory tax exemption was created for photovoltaic systems with a gross output of up to 30 kilowatts.
New regulation in detail
Photovoltaic systems on single-family homes or non-residential buildings are tax-exempt retroactively from Jan. 1, 2022, if the gross output does not exceed 30 kilowatts. Systems on or attached to other buildings (mixed-use buildings 2) are tax-exempt if the gross installed capacity does not exceed 15 kilowatts per residential or commercial unit. The values apply to each individual installation. A maximum limit of 100 kilowatts applies to multiple installations. The 100-kW limit applies per taxpayer or per joint venture. The tax exemption applies regardless of how the electricity generated is used. The tax exemption also applies if the electricity is sold entirely to the grid operator or used to charge an e-car used for business purposes. The new regulations apply regardless of when the system was built.
Status: December 28, 2022
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