What is the VAT rate for solar and battery storage?
HM Revenue and Customs (HMRC) has put forward legislation to increase the VAT rate for solar and battery storage from 5% to 20%. HMRC cites EU tax laws as a reason for the VAT legislation. Credit: Zbynek Burival.
What does the new zero VAT rate for battery storage mean?
As of the 1st February, some retrofit batteries now benefit from zero rate VAT, allowing homeowners who have historically fitted solar PV to more cost-effectively update their system to include electrical energy storage.
Are battery storage systems subject to VAT?
As from February 1, 2024, all battery storage systems installed in UK homes benefit from a VAT exemption regardless of whether they are fitted at the same time as solar PV. This equals the playing field for retrofit applications which previously would have been subject to 20% VAT.
What is the VAT rate for installing energy saving materials?
The VAT rate for installing energy saving materials is currently 0%, until 1 April 2027. What is the vat rate for servicing and repairing firstly Air Source heat pumps and heat pump controllers, and secondly solar PV inverters and solar PV generation meters (in residential properties). not to the servicing/repair of these materials.
Why does HMRC increase VAT on solar and battery storage?
HMRC cites EU tax laws as a reason for the VAT legislation. Credit: Zbynek Burival. UK Government tax department HM Revenue and Customs (HMRC) has put forward legislation to increase the VAT rate for solar and battery storage from 5% to 20%.
Are solar and energy storage installations subject to VAT?
All solar and energy storage installations, including maintenance to existing sites, should be subject to 0% VAT. This should include residential energy storage when installed as a standalone measure.
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All solar and energy storage installations, including maintenance to existing sites, should be subject to 0% VAT. This should include residential energy storage when installed as a standalone measure.
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