Rebates & Incentives

TAX Depreciation

In general depreciation is 20 % on plant and machinery for any business.

In the case of solar power generation, in order to incentivize the Solar power plant owner the Government of India has allowed claiming 80% depreciation in year one of the commissioning of the solar power generation plant.

This can provide significant savings to a solar energy plant owner who is a taxable assesse and has sufficient profits against which the depreciation can be charged.

Example: Let us assume that the total project cost is Rs.100000.00 (One Lakh)

Sl.No Item Cost
1 Cost of Solar Rooftop plant (A) Rs.100000
2 Accelerated Depreciation @80% Rs.80000
3 Corporate Tax Rate 35%
4 Tax saved through depreciation (B) Rs.28000
5 Net cost of solar rooftop plant (A)-(B) Rs.72000