Capital allowances and commercial solar, speak to your accountant

Tax treatment of commercial solar PV depends on your company's specific circumstances. MTFD is not a tax adviser, this page signposts the topics to discuss with your accountant rather than giving tax advice.

MTFD is a commercial solar funder, not a tax adviser. Tax treatment of any commercial solar funding structure depends on your company's specific situation, accounting policies, and HMRC interpretation. Please consult your accountant or qualified tax adviser before relying on any tax outcome.

That said, the relevant topics most accountants will consider when reviewing a commercial solar decision include capital allowances (including how the Annual Investment Allowance and current first-year relief regimes apply to plant and machinery), the difference between owning the system outright versus paying for electricity under a PPA, the treatment of lease payments, and how each route appears on the balance sheet and the profit and loss account.

The headline point for any conversation with your accountant: the tax position differs materially between outright CapEx purchase, asset finance / lease, and a Power Purchase Agreement. The right structure for tax purposes depends on your group's profitability, capital availability, accounting policies, and broader corporate tax position, all things your own adviser is in the best position to assess.

We recommend bringing your accountant into the funding-route decision early. They can confirm the tax position for your specific structure before you commit to a route.

FAQ

Does MTFD give tax advice?

No. MTFD is a commercial solar funder, not a tax adviser. We recommend speaking to your accountant about the tax implications of any solar funding structure.

Where can I get tax advice on commercial solar?

Your existing accountant or a qualified chartered tax adviser (CTA). The CIOT directory at tax.org.uk lists qualified advisers if you don't currently have one.

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