Section 12B · Automotive

Section 12B Solar Tax Deduction for the Automotive Sector

From car dealerships and panel beaters to OEM assembly plants, the automotive sector consumes significant electricity for showroom lighting, workshop equipment, spray booths, and compressed-air systems. Section 12B's 125% first-year deduction turns rooftop solar into a profit-boosting investment.

Automotive Energy Profile

Automotive businesses consume energy during standard business hours. Showrooms require extensive lighting, workshops run compressors and hoists, and spray booths use powerful extraction fans. Solar output covers these loads almost perfectly.

Typical System

120 kW

Monthly Usage

20,000 kWh

Peak Hours

07:30-17:30

Solar Match

82%

How Section 12B Benefits Automotive

A dealership group investing R1.68 million in solar claims a R2.1 million Section 12B deduction. At 27% tax, the R567,000 first-year tax saving accelerates payback to under 3 years.

Dealerships have large roof areas across showrooms, workshops, and covered forecourts. Solar carports over vehicle display areas serve a dual purpose: generating electricity and protecting stock from sun and hail damage.

Example: 120 kW System for Automotive

Based on typical industry parameters. Your actual results will vary.

Section 12B Deduction

R1,680,000

Year 1 Tax Saving

R453,600

Payback (with tax)

2.0 yrs

Simple Payback

2.6 yrs

IRR

54.7%

25-Year Saving

R80,370,274

Automotive Solar ROI by City

Johannesburg Gauteng Durban KwaZulu-Natal Port Elizabeth Eastern Cape East London Eastern Cape Pretoria Gauteng

Frequently Asked Questions

Yes. Any business that owns its solar installation and uses it for trade purposes can claim Section 12B. Dealerships, service centres, and fleet operators all qualify.

Spray booths consume significant electricity for ventilation and curing. Solar offsets this daytime load directly, and battery backup prevents interrupted paint jobs during load-shedding.

Yes. Solar carports generate electricity while protecting vehicle inventory from UV damage and hail. Several major SA dealership groups have adopted this approach across their branch networks.

Other Industries

Manufacturing Retail Office/Commercial Warehouse/Distribution Agriculture Hospitality Healthcare Mining & Quarrying Logistics & Transport Food & Beverage Processing Education

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