The STC discount is the amount knocked off a solar quote because the customer assigns their STCs to the installer. These questions come from both sides of the counter: homeowners asking whether GST applies, installers asking how to show it.
This is general information at the time of writing and not tax advice.
What the discount is
The customer owns the right to create STCs on their system. Rather than waiting to sell them, they assign the right to the installer, who registers and sells the certificates. In return the customer pays less. The size of the discount equals the value the installer expects to receive for the certificates, less margin.
Homeowners
A household that is not carrying on a business and is not registered for GST is not making a taxable supply when it assigns STCs. There is no GST for the household to account for on the assignment, and generally no income either. See is the solar rebate taxable for the income tax side.
What the household does pay is GST on the system itself, as part of the price the installer charges.
Is the discounted price GST inclusive?
Most residential quotes show the final price after the STC discount, including GST. The point to check is how the invoice is itemised. A clear invoice shows:
- the gross price of the system and installation
- the STC discount as a separate line
- GST on the amount payable
- the total
If the quote only shows a single lump sum, ask the installer to break it down. A transparent invoice protects both parties in an audit or a dispute.
Installers
How you present the discount can change the GST on your sale. The ATO’s guidance on the Small-scale Renewable Energy Scheme covers the accepted treatment, and your accountant can tell you how it applies to your invoices. Installers receiving the assignment are not generally entitled to a GST credit on it. That is covered in more detail in GST on STC sales for installers.
Commercial customers
If the system owner is registered for GST and the system is used in a business, the assignment can be a taxable supply on their side. That calls for a different invoice treatment, and a conversation with both accountants. For larger commercial systems, see mid-scale solar STCs.
What this means for installers
Get the invoice right first. Show the discount, show GST and keep a copy of the assignment form with the job file. Then book the STC sale to your trader separately, using the RCTI. How the quote should present the discount is covered in how to present the STC discount on a quote.
For the trader side, see RCTIs for STC sales, the pricing page and how it works.