In this paper, fuzzy logic controller (FLC)-based three-phase shunt active power filter with photovoltaic (PV) system is proposed. This filter comprises voltage source converter (VSC) with DC link capacitor at the input side and is supplied by PV system. The salient feature of the filter is that it provides reactive power compensation with line current harmonic reduction and also neutral compensation at point of common coupling (PCC). The PV system and a battery are connected with VSC through DC–DC converter. This paper also proposes a control algorithm using instantaneous [Formula: see text]-[Formula: see text] theory that generates a reference current to counteract the harmonics. The FLC controls the DC link voltage in reference to the above reference current. The performance of the proposed filter for compensation is confirmed by using the MATLAB/Simulink environment and results are validated.