Great news for those looking to optimize their energy consumption and save on taxes. The government has decided to extend income tax deductions for energy efficiency improvement works, including solar panel installation, until December 31, 2026. This measure, approved in the last Council of Ministers, presents a unique opportunity for those who want to make their home more efficient while benefiting from significant economic advantages.
Since 2021, these deductions have generated savings of more than 300 million euros for thousands of families who have invested in energy rehabilitation. Now, with this extension, taxpayers can continue to enjoy deductions of up to 60%, depending on the scope of the improvements made.
In this article, we will explain in detail what these deductions consist of, who can benefit, the applicable percentages based on the type of work, and how to apply for them. We also include practical examples to help you understand how to maximize these tax advantages when installing solar panels. Keep reading to discover how to save more while contributing to a sustainable future!
1. What is the IRPF Deduction for Installing Solar Panels?
The income tax deduction for installing solar panels is a fiscal incentive that allows homeowners or property communities to recover between 20% and 60% of the investment made in installing photovoltaic systems. This benefit applies to the total amount spent to improve the energy efficiency of the home or building and is directly reflected in your tax return.
In practical terms, for every 5 euros invested in solar panel installation, you can recover at least 1 euro through this deduction. This savings not only significantly reduces the initial installation cost but also adds to other available subsidies and aids, making solar energy an economically and environmentally friendly decision.
2. Who Can Apply for the IRPF Deduction for Installing Solar Panels?
The income tax deduction for installing solar panels is available to individuals who make energy efficiency improvements in their primary residence or any property they own. This includes both single-family homes and community properties, provided the necessary requirements are met to prove the improvement in energy efficiency.
A crucial requirement is obtaining an Energy Efficiency Certificate before and after the works. This document must show that, after the solar panel installation, the heating and cooling demand of the home has been reduced by at least 7% or that the property’s energy rating has improved by two levels.
3. Requirements to Qualify for the IRPF Deduction for Installing Solar Panels
To benefit from the tax deductions for installing solar panels, you must meet the following requirements established by the Tax Agency:
- Ownership of the property:
The applicant must be the owner of the property where the installation is carried out. They can also benefit if the property is rented, provided the rest of the conditions are met.
- Installation by authorized companies:
The works must be carried out exclusively by accredited and authorized companies to ensure compliance with applicable regulations.
- Energy Efficiency Certificate before and after the installation:
Before starting the works, an initial Energy Efficiency Certificate of the property is required to assess its previous state.
After the installation of the solar panels, a new Energy Efficiency Certificate must be obtained, reflecting a minimum reduction of 7% in heating and cooling demand. Depending on the deduction level, it may be necessary to prove that the property has achieved an A or B energy rating.
Both certificates must be issued by a qualified technician and will be essential to justify the energy improvement to the Tax Agency.
4. Deductible Percentages for Installing Solar Panels
4.1. 20% Deduction with a Maximum Amount of €5,000
The first deduction level allows you to recover 20% of the investment made in solar panel installation, provided the following conditions are met:
- Energy demand reduction: The installation must ensure a minimum reduction of 7% in the heating and cooling demand of the property, certified through an Energy Efficiency Certificate.
- Deadline for completion: The installation must be completed by December 31, 2025.
- Issuance of the updated certificate: The new Energy Efficiency Certificate must be issued before January 1, 2026.
The maximum annual deductible base for this level is €5,000 per home, whether it is a primary residence or rental property.
4.2. 40% Deduction with a Maximum Amount of €7,500
The second deduction level allows you to benefit from 40% of the investment in solar photovoltaic panel installation if the following requirements are met:
- Energy consumption reduction: The installation must achieve at least a 30% reduction in non-renewable primary energy consumption or improve the property’s energy rating to A or B.
- Completion deadline: The installation must be completed by December 31, 2025.
- Updated energy certificate: The new Energy Efficiency Certificate must be issued before January 1, 2026.
In this level, the maximum annual deductible base is €7,500 per home.
4.3. 60% Deduction with a Maximum Base of €15,000
The third deduction level provides a 60% tax benefit on the total investment in solar panels in residential buildings, as long as energy efficiency improvements affect the entire building. The following requirements must be met:
- Energy consumption reduction: The works must achieve at least a 30% reduction in non-renewable primary energy consumption or improve the building’s energy rating to A or B.
- Completion deadline: The improvements must be completed by December 31, 2026.
- Updated energy certificate: The new Energy Efficiency Certificate must be issued before January 1, 2027.
This deduction level also covers investments in garage spaces or storage rooms acquired with the property. The maximum annual deductible base is €5,000, but if the deductible amount exceeds this limit, the excess can be applied in the next four fiscal years, with the same annual limit, up to a total maximum of €15,000 per home.
For a summary of the deduction percentages, requirements, and conditions, refer to the table below.
5. Practical Example: Application of the 60% Deduction
6. How to Apply for the IRPF Deduction for Installing Solar Panels
To apply for the IRPF deduction for the installation of solar panels, you must follow these steps during the tax return:
- Gather the necessary documents: Make sure you have all the documents that accredit the installation, such as the invoice for the purchase of the solar panels and the Energy Efficiency Certificate, both initial and final.
- Access your draft income tax return: When filing your tax return, you must mark the boxes corresponding to the deductions for energy efficiency improvement works (boxes 1655-1680 and 1772-1772).
- Include the corresponding amounts: In the section “Energy rehabilitation works” you must include the total amount of the installation and the cost of the works carried out.
- Upload supporting documentation: During the process, you will be asked to upload documents proving that you meet the requirements, such as installation invoices and Energy Efficiency Certificates.
- Review of the result: Once you have completed the declaration, you will be able to see how the result changes depending on the deduction applied.
If for some reason you cannot process the application electronically, you can also do it in person at the Tax Office before June 30 of the corresponding year.
7. Common rules for personal IRPF deductions for the installation of solar panels
It is important to take into account several rules when applying for deductions for the installation of solar panels:
- Incompatibility between deductions: You cannot apply several deductions for the same work. If you have already applied for one deduction, you will not be able to benefit from another one related to the same installation.
- Allowable means of payment: In order for the amounts paid to be considered deductible, they must have been made by bank transfer, credit or debit card, nominative check or by deposit in bank accounts of the entities in charge of carrying out the works and issuing the certificates.
- Subsidies and public aid: If you have already received public aid for the installation, you must subtract the amount of the subsidy from the deduction base. Amounts paid in cash are not considered valid for deduction.
- What does the deductible amount include? The deduction base includes all costs directly related to the work, such as installation, professional fees, technical projects, construction management, materials and equipment needed, and expenses derived from the energy efficiency certification.
- Exclusion of fossil fuels: Expenses related to the installation or replacement of equipment using fossil fuels will not be considered deductible.
- Requirements for energy efficiency certificates: The certificates must be issued and registered in accordance with Royal Decree 390/2021, which regulates the procedure for the certification of energy efficiency of buildings.
- Aids not integrable in the IRPF: Aids intended to cover the costs of audiovisual communication services and those received for energy rehabilitation programs should not be included in the IRPF taxable base.
8. Take advantage of the deductions in the IRPF for installing solar panels with Ubora Solar
At Ubora Solar, we know that taking advantage of tax deductions for the installation of solar panels is an excellent way to reduce the costs of your project and contribute to a more sustainable future. With the extension of the IRPF deductions until 2026, now is the perfect time to take the step towards energy efficiency in your home or community.
We take care of the whole process, from the installation of the solar panels to the management of the necessary documentation so that you can benefit from these tax advantages. If you are interested in optimizing your energy consumption and taking advantage of the deductions, do not hesitate to contact us by calling +34 683 300 529 or sending an email to sol@uborasolar.com.
I want to get my IRPF Deduction
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