Adding solar panels as investment - income tax??

Not as good a return as they were.due to lower FIT. (Feed in tariff)
When ours went in 3 years ago the FIT was abour 12p KW. With capacity up to 30KW there was no need to have an export meter, Assumption was 50 % was exported paid for @ about 5p KW
Aim is to use as much as possible which saves whatever your day rate is .
Our will have covered their cost in 5 years

@Exfarmer will probably be along shortly with more info. I believe unless you can use all the output on your site then the figures don`t stack up any more

Firstly , buying panels to sell money to the grid will definitely not pay.
The level of Fits today means you will only pay if you use the very large majority of production.
For all installs you will need to register with a FIT provider, ( in reality any major energy supplier such as EON), it does not need to be the supplier currently providing your power.
Once registered you will have to declare your quarterly production . If your install is below 30 kwp it will be automatically assumed you export to the grid 50% of production .
If the install is over 30kwp you will need to meter the export via an export meter. This is an expensive option and makes it not realistic unless you are exporting a substantial amount of power
For a sub 10kw system it will be assumed it is domestic and any income is not subject to tax.
However you cannot reclaim the VAT , but it will only be 5% . Of course if it is an industrial unit i think you will have to pay tax

Installing 10kW with 6.8 year payback next week.

Invest before tariff disappears next year.

You get paid for producing the energy. You get paid again for exporting 50% of what you produce. So if you produce 10,000kwh you get paid for 5000 at the export rate. You get paid yet again by using as much of it your self as possible. Because it is electricity you are not having to buy from the grid.

How much is a up to 30kwh costing now (ground mounted). Any one recommend a insulation comp.

Case290 said:

How much is a up to 30kwh costing now (ground mounted). Any one recommend a insulation comp.

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It should come in under £30k but depends if you have to cable a long way

sparrowling said:

Hello I've been looking into solar panels as an investment into powering low power things like lighting, and then selling off anything unused back to the grid. I was wondering how money returned from the solar panel works - does it just come off the power bill or is it credited back or something? Is the income taxable? This tax calculator says what I'd pay on any money I save/get back based on my estimates but I'm not sure if I'd actually pay that so was hoping someone here could answer/point me to an answer, because I really don't have a clue!

Cheers

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It is a bit confusing but basically its split into 3 things.

1. Your installed system has a maximum output, which in our case is 70kw. This pays us about £24,000 per year in FIT (feed in tariffs) as we installed in 2011 when tariffs were a lot higher. This income is taxable.

2. Then you have the savings in bought in electricity because you are producing your own. For us the solar sits on a line that has an annual use of around 120,000kwh in total (day and night). During the daytime we use the electricity generated from the solar panels first meaning that we only purchase around 60,000kwh per year. Then we have night time usage which we buy obviously because our panels arnt producing at night.

3. Finally you have the potential to export anything unused. So our use depends on a number of things such as grain drier running etc so at time we do have a surplus. That surplus is sold to the grid via a 3rd party at about 5.5p/kwh but we have to pay that company a standing charge of about £250/year for the privilege. Without checking I think we probably sell about £1000 worth per year so we are about £750 better off for it, so hardly worth it to be honest as I think we probably paid for the meter change originally.

For us we are about £30,000 per year better off without being to precise but thats before tax.