Solar and efficient renewable energy is becoming increasingly popular amongst commercial and residential users who are looking for alternatives to carbon-based electricity supplied by South African utilities.
Electricity in South Africa is becoming more expensive each year with regular double digit tariff increases. In comparison, the technology improvements and reduction in cost of alternatives, particularly in the solar photovoltaic (PV), solar thermal and energy storage space, has resulted in alternative energy solutions becoming more cost efficient to the end user. More and more end users are now turning to the alternative space to reduce costs and cut emissions.
The solar and efficient renewable energy industry continues to experience unprecedented growth due to this movement away from carbon-based electricity supply. Bright Light Solar VCC plans to benefit from the increased demand and has already secured a significant pipeline of clients interested in signing long-term electricity supply and services agreements.
S12J of the Income Tax Act allows investors to deduct the full cost of their investment against their taxable income, thereby obtaining a full tax write-off of their investment capital. As long as the investment is held for a period of 5 years or longer, there is no recoupment of this tax deduction.
Benefits of the Bright Light Solar VCC structure to investors:
The tax deduction of the entire amount invested against taxable income, limited to R2.5m for individuals and trusts, R5m for companies;
The provision of IT3s to assist in tax-deductibility of investment as well as annual returns;
A fully managed process with no involvement required from the investors
Semi-annual dividend paid from year 1;
Ongoing semi-annual dividend for 25 years;
Targeted year 1 dividend of 6.6%, growing annually (based on full deployment of capital raised);
Targeted IRR of 17.5% after tax return on investment capital (after dividend taxes);
Targeted IRR of 21.0% after tax return on risk capital (after dividend taxes);
Lowest fees in the s12J industry (no performance fee on your tax saving);
Liquidity provided for investors wishing to exit in year 6 and beyond;
Credit enhancement minimises credit risk (gated estate clients); and
The ability to exit the investment after 5 years.
Any individual, corporate entity or Trust, as a registered taxpayer in South Africa, automatically qualifies to invest in an approved S12J Venture Capital Company.
Bright Light Solar VCC Ltd is a registered S12J Venture Capital Company in terms of the Income Tax Act (SARS VCC reference number VCC-0060) and is an authorised Financial Services Provider, FSCA License number 47804.