This is general information, not tax advice. Your accountant or the ATO has the final word on your circumstances.
The principle
When a household assigns its STCs to the installer, it is paying for the battery partly in cash and partly in certificates. The ATO’s approach to STC arrangements is that the certificates are consideration for the supply, so the taxable value of the battery sale generally reflects both parts. In practice that means the GST on the sale is calculated on the full price, not only on what the customer hands over on the day.
That is why a clear invoice matters. A customer who sees only a net figure may assume GST is charged on that net figure, and a GST-registered installer who builds the invoice that way can under-report. Show the full price with GST, the STC discount as a separate line, and the balance payable. See how to show the discount on an invoice.
The second supply: selling the STCs
When you sell the STCs to a trader, that is a separate transaction. A GST-registered installer’s sale of STCs is generally a taxable supply, and most traders issue a recipient-created tax invoice (RCTI) rather than waiting for you to invoice. The RCTI, GST and ABN guide walks through the details, and GST on STC sales covers the registered versus unregistered split.
A simple walk-through
| Step | Treatment (general) |
|---|---|
| Customer pays cash, assigns STCs | One supply of the battery system |
| Installer invoices | GST on full value, STC discount shown as a line |
| Installer sells STCs to trader | Separate taxable supply if GST registered |
| Trader pays | Often via RCTI |
Common mistakes
Typical errors include treating the STC discount as a price cut before GST, forgetting that the STC sale is a second supply, quoting a GST-exclusive figure to a household and leaving ABN or GST status out of the trader’s records. Each is simple to avoid if the job record holds the full price, the STC value and the sale proceeds together.
What this means for installers
Set your accounting up so the STC value flows through the same job record as the sale. Many cash-flow surprises come from treating the discount as a pure price cut and then forgetting there is GST on the certificate sale. If you are not registered because you are under the threshold, note that the treatment changes, and take advice before the first big battery month.
From the desk: if your STC proceeds arrive on an RCTI, reconcile the RCTI to the claim, not just the bank deposit. Mismatched ABN or GST status on the RCTI is a common reason for payment delays.
For homeowners, the related question of whether the discount counts as income is on battery rebate taxable income. The scheme itself is on battery STCs. Energy Merchants publishes its pricing daily and settles to registered partners; start trading to set up ABN and GST details once.