VAT exemption for solar systems in 2024: an overview for Germany, Austria and Switzerland

The promotion of renewable energy, in particular solar systems, is a central part of energy policy in Europe. In 2024, important changes affecting the tax treatment of solar systems come into force in Germany, Austria and Switzerland. These changes are of great importance for investors, homeowners and the solar industry. In this blog post, we look at the VAT exemption for solar systems in these three countries, backed by legal references and detailed information.

Germany

• Legal basis: The Annual Tax Act 2022 (Jahressteuergesetz 2022) introduced the VAT exemption for solar systems from 01.01.2023.
• Details: The VAT exemption in Germany enables consumers and businesses to benefit from a zero VAT rate. This applies both to the purchase and to the operation of solar systems. This rule is particularly interesting for smaller systems, as it improves their economic viability and access to renewable energy.
• Duration of the measure: There are currently no official announcements about the planned end date of this tax exemption. However, it is important to keep an eye on political developments, as changes in energy policy can have a direct impact on support measures.

Solar support in Bavaria

• Bavaria-wide support programmes: Bavaria offers various support programmes for solar systems, such as the 10,000 Houses Programme (10.000-Häuser-Programm), which is aimed specifically at private homeowners and their investment in photovoltaics and solar thermal energy.
• Regional particularities: Owing to its geographical location and the high number of sunshine hours, Bavaria is particularly well suited to the use of solar energy. This is supported by state subsidies.

Austria

• Legal basis: The Budget Accompanying Act 2024 (Budgetbegleitgesetz 2024) provides for a temporary VAT exemption (tax rate of 0%) for photovoltaic modules.
• Details: From 1 January 2024, a simplified system applies in Austria for PV systems with an output of up to 35 kilowatts. This rule, laid down in § 28 para. 62 UStG 1994 (Austrian VAT Act), is a decisive step towards promoting solar energy and achieving climate targets. The VAT exemption applies to the purchase, installation and maintenance of solar systems.
• Effects: This measure is expected to lead to an increase in demand for solar systems and may reduce energy costs for consumers.

Photovoltaic tax benefits in Vienna

• Viennese solar support: Vienna offers attractive support for photovoltaic systems, applying to both private and commercial buildings. This includes grants for the installation of solar systems.
• City energy plan: Vienna has an ambitious energy plan that provides for the expansion of renewable energy, including solar energy. This plan offers long-term security for investors.