How to claim back VAT for your solar panels?
Did you know that in the Netherlands, if you install solar panels, you can claim the 21% BTW (belasting over de toegevoegde waarde) or the VAT paid for the solar panels?
It does sound too good to be true, but in order to encourage solar installations, a Dutch individual is allowed to reclaim the BTW on the purchase of solar panels. This is the only BTW on a purchase that a Dutch individual can reclaim. This exemption is made as with the installation of solar panels, the individual is recognised as a ‘small entrepreneur’ by the Belastingdienst or the Tax and Customs Administration.
When an individual installs solar panels, the excess energy generated is fed back into the grid. The individual functions as a small energy supplier and therefore can reclaim the BTW on the initial investment.
Prior to filing a return, the person should meet the following 2 pre-requisites:
- The invoice of the solar panels and invoice from the energy company should be in the individual’s name
- The VAT should be reclaimed within 6 months of the year in which the investment was made
If the individual satisfies the above criteria, the refund can be claimed by just following 3 simple steps.
STEP 1: Register as an entrepreneur
To start the registration the user has to send the ‘Declaration of solar panel holders’ form to the Belastingdienst which registers the individual as an entrepreneur and declares that the individual wants to participate in Kleineondernemersregeling (KOR) or the small business scheme. An individual can opt for KOR if her/his turnover is less than € 20,000 per year. By participating in the KOR, the individual can file a return once, with which she/he can declare and reclaim the BTW in the year of purchase of the solar panel. For 3 years following the year of purchase, she/he cannot reclaim BTW on any investment.
STEP 2: Provide the account number for the refund
After the individual receives a letter with a BTW number as a confirmation of her/his registration, the person’s bank account number should be provided to the Belastingdienst by filing the ‘Opgeven of wijzigen rekeningnummer ondernemers’ (Register or change account number entrepreneurs) form. This can be done by logging in with DigiD on the Mijn Belastingdienst Zakelijk (My Tax and Customs Administration).
STEP 3: File the BTW return
Once the above-mentioned form is submitted, the individual receives a letter named ‘Determination of tax liability’ that enables her/him to file a refund offline. However, in case an individual does not receive the letter, the refund can then be filed digitally on Mijn Belastingdienst Zakelijk (My Tax and Customs Administration). In either situation, while filing the declaration, it is important to know the invoice for the purchase and installation; and the maximum generating power of the installed solar panels. These details help to determine the refund that can be claimed by an individual as described further.
Forfait: As you are considered an entrepreneur, the BTW on the energy you supply to the grid should be deducted from the BTW you claim back. But calculating the exact amount of power that an individual instalment fed into the grid can be complicated. Therefore the Belastingdienst uses an estimate (called forfait) according to the installed solar panels’ generating capacity, which is as seen in the table below.
- Generating power in Watt peak
- 0 – 1000
- 1001 – 2000
- 2001 – 3000
- 3001 – 4000
- 4001 – 5000
- 5001 – 6000
- 6001 – 7000
- 7001 – 8000
- 8001 – 9000
- 9001 – 10.000
(The table above shows the forfait for non-integrated solar panels or solar panels installed on the roof. To view the forfait for integrated solar panels or solar panels installed click here)
Lets take an example
Ms. Lukszo was charged €500 BTW on a purchase and installation and the generating capacity of the solar panels is 2,500 Watt peak. According to the table above, she must declare a BTW of €60. However, the BTW of initial investment is €500 and therefore her BTW refund will be €440 (€500 – €60).
Once the declaration is filed and submitted Ms. Lukszo will receive the refund decision in a few weeks. Thereafter, the money will be refunded to the provided account number within 10 working days.
Though the steps are simple, there can be some exemptions to be considered during the calculations. However, Team Umagine can take care of the complete BTW refund process for you with your installations.
Contact us and we will be happy to help you with the process.