Use your ROT deduction to install a pellet boiler

The benefits of a pellet boiler are numerous. In the long run, it's a heat source that can help reduce energy costs and contribute to a more sustainable energy consumption. It's also appreciated by many because a pellet boiler is easy to maintain. However, the installation of the pellet boiler itself may require a certain budget allocation. But, don't forget that you can use the ROT deduction to offset parts of the installation cost!

ROT Deduction for 2023

The ROT deduction is a tax reduction that allows you to deduct parts of the labor cost associated with work performed on or in properties and real estate that you own. The ROT deduction is personal and is set at 50,000 SEK per person for 2023.

This means that each individual can deduct labor costs up to 50,000 SEK in 2023. When 2023 transitions to 2024, the amount you've applied for is reset. For 2024, a new amount for the ROT deduction is determined, and you can then apply for a deduction based on the new amount.

It's worth mentioning, though, that those applying for the ROT deduction must own the residence or property where the work is carried out. For instance, if you and a partner want to apply for the ROT deduction, both must own shares. Being registered at the address is not sufficient.

The ROT Deduction Applies to Pellet Boiler Installations

Calculations can be done in various ways. One common method is to use a standard calculation if the company has carried out a total contract at a fixed price. The standard calculation is used to distinguish costs for materials, machinery, and other expenses. As previously mentioned, the ROT deduction only covers the labor cost itself and nothing else.

This means that you first calculate 24% of the total cost you pay via the invoice. Then you calculate 30% of the resulting sum. These 30% are considered to represent the cost of the actual work. If you pay a total of 20,000 SEK for a total contract, 24% of that amount would be 4,800 SEK. If you then take 30% of 4,800 SEK, you get 1,440 SEK. So, for calculations like this, you'd get 1,440 SEK.

However, the company performing the work doesn't have to use a standard calculation. Instead, they can submit documentation that outlines all the actual costs to the Swedish Tax Agency. In this case, they simply provide exact costs that are included in the total amount. This way, the Tax Agency can easily see the separate costs, as expenses such as materials, products, and other costs are separated from labor costs. You can then get a deduction for 30% of the amount that the company reports as pure labor costs. If the labor cost is 5,000 SEK, you can make a deduction of 1,500 SEK.

Double-check What Applies to You and the ROT Deduction

Before you proceed, it's important to double-check that you're eligible for the ROT deduction and the amount it entails. Keep in mind that the deduction is preliminary until the Swedish Tax Agency assesses whether you're entitled to it or not.

This simply means that you receive a deduction on the invoice you pay to the company performing the work. The company, in turn, submits an application to the Swedish Tax Agency to receive the amount. If it turns out that you're not eligible for the ROT deduction, you would need to repay the deduction to the Tax Agency.

Factors that can affect the ROT deduction include your income during the year when the work was performed, ownership of funds and stocks, and whether you have previously applied for the ROT deduction in the same year. You can find more detailed information on the Swedish Tax Agency's website. You can also call them to ask specific questions.

Feel free to read further and see if you can achieve reduced costs with the help of energy subsidies for small houses here.

Affordable Package Deals with High-Quality Pellet Boilers

At ULMA, you'll find several options for affordable package deals that include everything you need to install a pellet boiler. In addition to pellet boilers, you'll also find pellet stoves, wood-burning stoves, and hot air boilers. Regardless of the products you're choosing between, you can rest assured that our Swedish-made products are high-quality, efficient, and reliable.

You're warmly welcome to reach out to us if you have any questions about pellet boiler installation. We have extensive experience and are more than happy to answer your inquiries!