Tom Neville (Limerick County, Fine Gael)
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87. To ask the Minister for Finance the policy on taxing income generated from solar panels; and if he will make a statement on the matter. [19112/17]

Michael Noonan (Limerick City, Fine Gael)
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Where a person is generating electricity from solar panels and sells that electricity into the national grid the income from such activity would, in general, be considered a business activity and accordingly the income would be assessed as trading income chargeable under Case I of Schedule D.  In cases where the generation of electricity is primarily for own use, and only surplus electricity is sold on an intermittent basis, the income from the sale of the surplus electricity would be assessed under Case IV of Schedule D.

Where land is leased to persons engaged in the generation of electricity from solar panels the income from such letting is assessed under Case V of Schedule D.

In the case of an individual, the profit to be assessed to tax under Case I, IV or V of Schedule D, as appropriate, is the net income after deduction of allowable expenses.  The profit will be assessed to income tax at the individual's marginal rate of tax and, in addition, will be subject to USC and PRSI, as determined by his or her total taxable income in the relevant tax year.

I stated at the Report Stage of Finance Bill 2016 that the taxation issues relating to the use of solar panels required careful consideration as there were several interconnected issues at play surrounding taxation, the environment and a sustainable energy policy. An inter-departmental group is examining these issues and I await their deliberations and recommendations.