If a craftsman installs photovoltaics, the costs are tax deductible

No VAT is charged on the purchase of a photovoltaic system. The Federal Ministry of Finance has clarified that installation by qualified professionals is also eligible for tax benefits.

Now, a new photovoltaic system on the balcony or roof of owner-occupied residential property is worthwhile in several ways from a tax perspective: When purchasing such a system, VAT has been waived for a capacity of up to 30 kWp since January 2023.

Furthermore, the Federal Ministry of Finance (BMF) clarified in a letter dated July 17, 2023 (Ref. No. IV C 6 - S 2121/23/10001 :001) that a tax rebate is also possible for the installation of the system by qualified professionals . Such expenses are to be eligible for tax relief in the same way as other work performed by tradespeople in the home.

"This is a good incentive to do good for the climate and at the same time save on energy costs," the Federal Association of Wage Tax Assistance Associations (BVL) welcomes the rules.

Tax reduction for installation of tax-exempt photovoltaic systems

The tax break can be claimed for photovoltaic systems installed in one's own home . "This can be on the balcony of an apartment, on the residential property, or on a vacation home used by the owner," explains Jana Bauer, Deputy Managing Director of the BVL. "The only condition is that the income from the photovoltaic system is tax-free . But that should usually be the case."

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Retroactive to January 1, 2022, operators no longer have to pay taxes on income generated by a photovoltaic system with a maximum output of 30 kWp on the roof of their single-family home and/or its outbuildings. This also applies to systems on the balcony of an apartment building or other building with a maximum output of 15 kWp per residential and commercial unit.

Maximum tax bonus of 1.200 euros for craftsmen's services per year

For example, if a married couple has a 9 kWp photovoltaic system installed on the roof of their detached house, they can claim the costs for the installer in their tax return . Tax relief is also available if the professionals service or repair the system on-site.

A total of up to €6.000 per year can be claimed as a tax deduction for labor, travel, and equipment costs for all household repairs . Twenty percent of this amount qualifies , resulting in a maximum tax saving of €1.200 . If other eligible repairs have already been carried out during the year , the maximum possible tax saving is reduced by the amount already claimed. Material costs are always excluded and should be itemized separately on the invoice . "It's also important that the invoice is paid by bank transfer and not in cash ," advises Jana Bauer.

More and more companies and private households are using solar energy to generate electricity. In July 2025, there were already five million photovoltaic systems on roofs and properties in Germany, 2,4 million more than in 2023, reports the Federal Statistical Office (Destatis).

No tax bonus for public funding

If the system is financed with public funding and therefore no costs have been incurred, the tax deduction is excluded . "Everyone should check for themselves whether the tax rebate or the government subsidy is more advantageous," recommends Jana Bauer.

Source: German Association of Wage Tax Assistance Associations (BVL)

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