Do you have a rental property? If so, you’ve probably been wondering if solar panels are worth the investment. The answer is yes – these systems can be claimed at EOFY, and they will save you money in the long run.
You can win financially when you put panels on your property. You can claim tax deductions on the purchase of solar power – as it is a capital expenditure and can be claimed over many years. The landlord can also claim the rebate for exporting power back to the grid to help pay off the system.
How does solar power on a rental property work?
Electricity bills change when using rooftop PV systems, with electricity being charged, renewable energy exported back to the grid, and rebates paid back to the party with their name on the bill. This can make things a little bit complicated, and both the landlord and the tenant will need to reach a mutual agreement.
Three scenarios can take place:
- The tenant’s name is on the electricity bill, and they pay it as per usual, receiving the rebate.
- The owner can keep the bill in their name, pay it and receive the rebate, then pass the charges to the tenant. The owner can either take the savings off the amount owed by the resident, take off part of the rebate, or keep the savings to themselves (to pay off the installation of the system).
- The property owner keeps the bill in their name, pays the total amount, keeps the rebate and then adds the cost of electricity to the rent owed each week.
If the owner elects to keep the bill in their name, they cannot charge the tenant any more than the amount charged by the provider. They have no obligation to pass savings onto the resident.
Can tenants install panels on their rental property?
In most cases, this is not a financially viable option. When you move out, the solar system will still belong to the owner, and you’ll likely be out of pocket. However, that doesn’t mean you’re out of options when it comes to accessing renewable energy.
There is always the opportunity to come to an arrangement with the owner. A new system will be an investment, allow them to charge more rent, and it will pay itself off in time.
For those that live in units or townhouses, shop around. Many new complexes are being constructed with panels included, with the benefits passed onto the tenants. Many public housing complexes include solar as well, in exchange for a slight rent increase.
If you have any further questions, contact your residential tenancy authority in your state or territory to ask about your options.
Call us today on 1800 EMATTERS and get a quick quote. You can also email our friendly team for expert, obligation-free advice.
