How to Calculate GST on Your Solar System

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In Australia, solar energy plays a significant role as a sustainable power source.

Understanding the application of the Goods and Services Tax (GST) to solar power systems is vital for consumers. For residential users, the 10% GST is typically included in the solar system's upfront cost, simplifying pricing transparency.

Commercial customers may get quotes without GST. They should remember to add 10% GST when they buy something.

The distinction between these practices is essential to avoid deceptive pricing by unscrupulous solar companies. Consumers should exercise caution and seek transparent pricing. In conclusion, understanding GST's application in the solar industry empowers Australian consumers to make informed decisions and leverage solar power without unexpected costs.

Australia’s Approach to Solar Energy and GST

Solar energy is now widely used in Australia as a sustainable and clean energy source. Understanding how the Goods and Services Tax (GST) affects solar systems in this undertaking is crucial.

The majority of products and services, including solar systems, are subject to the 10% products and Services Tax. However, whether you are a household or commercial user will determine how GST on price is computed. To make sure you understand all the costs involved with purchasing a solar system, this distinction is essential.

GST for Residential Solar Customers (Price including upfront costs should have GST Included)

The GST on a solar system is usually simple for Australian residential consumers. The system’s initial cost covers it. This implies that the price you see when you obtain an estimate for a solar system already includes the 10% GST. For example, if a $5,000 solar system is quoted to you, the GST is already included in this price.

GST for Commercial Solar Customers (GST Added to the Final Cost)

Commercial clients buying solar PV systems face a different pricing setup compared to residential customers. Unlike residential solar panel system quotes, commercial quotes exclude the 10% GST. This means the quoted price is before adding GST.

For example, if a commercial client gets a $5,000 estimate, it’s pre-GST. They need to add 10% GST when they make the purchase.

Understanding this is important for business owners planning their solar investments. Knowing that GST isn’t included in the initial quote helps them budget accurately and avoid surprises later on.

When purchasing commercial solar panels, keep in mind that the quoted price does not include the GST. The GST will be added to the solar system price when you make the purchase. This clarity ensures businesses know the full cost of going solar.

Deceptive Practices to Be Aware Of (Transparency Matters)

Avoiding dishonest practices requires an understanding of the distinctions between residential and commercial GST applications. Some solar companies do not include GST in their initial pricing for commercial clients. They may add it later after the contract is signed and approved by the buyer. The difference between the initial estimate and the final price may cause customers to incur unforeseen costs.

Close-up of hand knocking on the door, trying to sell a solar system
Avoid door-knocking salesmen before purchasing solar and ensure to clarify pricing (including or excluding GST)

Protecting Consumers

Customers should be careful when comparing quotes from solar companies and understand how GST is added to protect themselves from scams. To avoid any unpleasant surprises later on, a trustworthy and open solar provider would include the GST in the quote it gives to business clients. For more articles related to unethical solar pressures read our article here:

How to calculate GST on your Solar Panel Systems

In Australia, calculating the Goods and Services Tax (GST) on solar panels is easy. The process varies depending on whether the buyer is a homeowner or a business. The procedures to compute GST on solar panels for both categories of clients are as follows:

For Residential Customers:

Check Your Quote: When you receive a quote from a solar panel provider, the price they provide you already includes the 10% GST. The price you see is the final cost that you will pay, and there’s no additional GST to calculate.

Example: If you get a quote for a home solar panel system for $6,000, the GST is already in the cost. You will pay the quoted amount.

For Commercial Customers:

Check the Quote. Just like with residential customers, the first quote you get for the solar panel system usually doesn’t have GST included. The GST will be added to the final cost when you make the purchase.

Calculate the GST. To calculate the GST for commercial solar customers, you must add 10% to the pre-GST cost provided in the quote. To find the GST amount, multiply the original quote by 0.10 (which is 10% as a decimal).

Example: If you receive a quote for a commercial solar panel system priced at $9,000 (pre-GST), you will calculate the GST as follows:

GST = $9,000 x 0.10 = $900

So, the GST amount to be added to the final cost is $900.


In conclusion, it is critical for Australian home and commercial consumers to understand how GST is applied to solar systems. It guarantees that you won’t be overcharged and supports you in making wise choices about solar system purchases.

Furthermore, it’s critical to exercise caution when interacting with businesses that can mislead clients by using the GST computation. A good solar company will give you clear prices that include GST. This helps you make informed choices and enjoy the benefits of solar power without extra costs.

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