How to Claim Section 12B: Step-by-Step Guide

Collect your solar installation invoice detailing equipment costs, a commissioning certificate confirming the system is operational, and proof of payment. The invoice should separately itemise panels, inverters, batteries, mounting, and installation.\n\nAlso obtain a certificate from your installer confirming the system generates electricity from solar photovoltaic technology. SARS may request this to verify the asset qualifies.

Calculate the total qualifying cost including panels, inverters, batteries, mounting structures, cabling, and installation labour. Exclude non-qualifying items such as backup generators or unrelated electrical upgrades.\n\nMultiply the qualifying cost by 125% to determine your Section 12B deduction amount. Confirm this figure with your accountant before filing.

The Section 12B deduction is claimed as a capital allowance on your income tax return (ITR14 for companies). Your accountant or tax practitioner includes it in the capital allowances section.\n\nThe deduction is claimed in the tax year when the solar system is first brought into use, not the year of purchase or installation. Ensure the commissioning date falls within the correct tax year.

Keep all documentation for at least five years after the tax year in which you claimed the deduction. SARS may audit the claim and request evidence of the installation, cost, and commissioning.\n\nPhotographs of the installation, meter readings showing generation, and the SSEG registration certificate provide additional supporting evidence. A well-documented claim is rarely challenged.