Finance your Solar Panel Installation

Renewable Technology Finance

Explore our comprehensive range of financial solutions tailored for commercial solar panels and clean energy projects. Solar Dynamics Finance is regulated by the FCA and has established partnerships with some of the UK’s top solar funders, enabling us to offer competitive financing options for cutting-edge clean energy technologies. We recognize that adopting renewable energy solutions often involves a substantial upfront investment, which is where our leading financial packages come into play, allowing you to distribute the cost through manageable monthly payments.

By choosing Solar Dynamics Finance , you not only reduce your carbon footprint but also enhance your operational efficiency. Our expert team is committed to helping you save money and make a positive environmental impact.

Whether you’re interested in commercial solar panel asset financing or prefer hire purchase agreements, we have a diverse range of options for financing renewable energy technologies. Solar Dynamics Finance can empower your company to achieve energy independence while contributing to a more sustainable future. The cost savings generated through reduced energy expenses can often offset the financing agreement, essentially paying for itself. Additionally, our team can provide valuable insights into government initiatives and grants designed to support this transition. Government programs offer grants and subsidies for energy-saving measures, benefiting businesses of all sizes by reducing their environmental footprint.

Sale and Leaseback Explained

Sale and leaseback transactions are financial arrangements that involve an entity selling an asset to a buyer, and then leasing the asset back from the buyer. This arrangement allows the seller to free up capital tied up in the asset while retaining the right to use the asset.

Solar Panel Asset Finance Explained

A conventional form of finance where an individual will obtain funding to acquire a specific asset, in this case solar panels.

The 0% VAT Reduction

This one is also known as zero percentage point VAT reduction. As the name suggests, this  tax incentive helps both individuals and businesses to get a massive cut on their value-added tax.

How Does 0% VAT Reduction Work?

The standard VAT across the UK is around 20% for most services and goods. Previously, several home energy services and items had a reduced VAT of around 5%.

However, in April 2022, the government announced a new program that brings this 5% down to 0% on various energy-efficient systems. This doesn’t only include buying solar panels but also installing them.

The program is due to run for around 5 years in total, lasting until the 31st of March, 2027. 

How Much Can You Save with the 0% VAT Reduction?

Savings on solar power with the 0% VAT heavily depends on the size of the system you’re going to install.

For instance, the average household would pay around £5,000 to £10,000 for standard 200W panels and high-capacity batteries needed to power a house. 

The additional VAT, in that case, would be around £250 to £500 for 5% reduced VAT or £1,000 to £2,000 for 20% standard VAT. The new scheme could save individuals and businesses that much!

Who Is Eligible for 0% VAT Reduction?

The program applies to all households. Since VAT applies to goods and services, businesses can also benefit from this scheme.

The 0% VAT Reduction initially applied to all households across England, Wales, and Scotland, but was then extended to Northern Ireland as of May 2023.

How to Apply for 0% VAT Reduction on Solar

Luckily, there aren’t any special requirements for UK-based households and property owners to become eligible for the 0% VAT, as it’s applied to the energy-efficient goods and services themselves.

The Annual Investment Allowance (AIA)

The Annual Investment Allowance is a kind of capital allowance that allows you to deduct and claim tax reliefs on assets that your business needs to buy. Luckily, installing solar panels is one of the items that qualify for this allowance.

How Does Annual Investment Allowance Work?

According to the official government website, the AIA allows businesses to deduct up to 100% of the price of an eligible item like solar panels before they need to calculate the taxes on their profits.

The maximum limit for what a business can claim per year changed various times over the years. Since January 2019, the limit has permanently reached a record high of £1 million.

While solar panels are among the eligible assets for the AIA, you should keep in mind that there are certain situations where you can’t claim them. These include

If you already used the same solar panels for other purposes before starting your business. (for example, transferring the panels from your house to your business).
If the solar panels were given or gifted to your business

Besides the AIA, solar panels also qualify for additional temporary tax breaks. These include:

50% First Year Allowance (FYA)
130% Super-Deduction (SD)
 

According to a report by the government website, businesses eligible for these allowances are expected to save up to 25% on their tax spending, as long as they’re within the stated limit.

Smart Export Guarantee

The SEG is a scheme supported by the UK government and was launched back in January 2020. 

The scheme requires licensed energy suppliers to pay consumers who generate low-carbon electricity (such as solar panels) in exchange for exporting any excess energy their households produce into the national grid.

In other words, if your house is powered by solar panels and you produce more energy than you consume, you can offload your excess into the grid and receive payments accordingly.

Keep in mind that only small-scale electricity producers (up to 5,000 kWh or 5mWh) can qualify for the SEG. 

The amount of money you can earn through this scheme will vary from one energy supplier to another. For instance, E energy and EDF pay 5p for every kWh of power exported while Octopus Energy pays from 15p - 32p per kWh depending on the time of day.

For more details on how Solar Dynamics Finance, combined with government assistance, can elevate your business, please reach out to us at 08000 99 66 88 or click below to complete a contact form and request a call-back

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