The South African Revenue Service (SARS) has released a guide “Guideline on the on Allowances and Deductions Relating to Assets Used in Generation of Electricity from Specified Sources of Renewable Energy” on 23 November 2024.
It provides general guidance on the tax incentives available for the generation of electricity from specified sources of renewable energy under section 12B(1)(h) and (i), the enhanced form of this deduction under section 12BA and the deduction under section 12U for amounts actually incurred on the construction of any road, the erecting of any fence and a foundation or supporting structure designed for such a fence as well as on the cost of the improvements to any road, fence or foundation or supporting structure that are used for the generation of electricity from specified sources of renewable energy.
This guide is not an “official publication” as defined in section 1 of the Tax Administration Act 28 of 2011 (the TA Act) and accordingly does not create a practice generally prevailing under section 5 of that Act. It does not consider the technical and legal detail that is often associated with taxation and should, therefore, not be used as a legal reference. It is also not a binding general ruling (BGR) under section 89 of the TA Act. Taxpayers requiring an advance tax ruling or a VAT ruling should visit the SARS website at www.sars.gov.za for details of the application procedure.