Retail Sales Tax Refund Calculations

Modified: 2022/04/29 11:45 by pete - Categorized as: Community Resources, PV
The Ontario Ministry of Revenue is offering a rebate on all retail sales tax paid on solar energy systems until Jan 1, 2010.
The rebate is for physical system components, not development soft costs and labour and is explained in greater detail below.

Where the owner or builder purchases the solar energy system components directly from a solar energy system supplier, the amount of the rebate is based on the RST paid on the components.

Where an owner enters into a written contract with a contractor to supply and install a solar energy system, or expand or upgrade an existing system, the owner may apply for a rebate based on a percentage of the total contract price.

As the owner may not know the actual amount of RST paid by the contractor, the percentage of the rebate will be calculated as follows:

  • if the federal Goods and Services Tax (GST) is included in the contract price, the rebate is calculated by multiplying the payments made (including the GST) by 3%,
  • if the GST is not included in the contract price, the rebate is calculated by multiplying the payments made by 3.4%.

When calculating the rebate using one of the above formulas, the following costs must be removed from the total contract price before calculating the rebate amount:

  • land or land improvement costs
  • the cost of obtaining a performance bond
  • charges for development or for project consulting services
  • building permit fees
  • equipment rental charges, and
  • the cost of tangible personal property that may be exempt from tax under any other section of the RST Act.

If the contractor provides the owner with actual receipts or a signed statement to confirm the actual amount of RST paid on the solar energy system components, then the owner may choose to claim this amount.

More Information

Find out more on the the Ontario Ministry of Revenue's Retail Sales Tax Rebate Webpage
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