If you’ve been thinking about installing solar panels or battery storage, there’s an important date to keep in mind. The 0% VAT rate on qualifying energy saving materials in homes, which includes solar panels and batteries, is currently due to end on 31 March 2027.
Here’s what the zero rate covers, what could change after the deadline and how to plan your installation so you’re not left rushing.
Since April 2022, the installation of qualifying energy saving materials in residential properties in Great Britain has been zero rated for VAT. In practice, this means homeowners pay no VAT on the supply and installation of solar panels, rather than the standard rate of 20%.
The relief was widened in February 2024 to include battery storage installed on its own or added to an existing solar system, along with some other technologies such as smart diverters. HMRC sets out the full rules in its guidance on VAT on energy saving materials and heating equipment.
For a qualifying residential installation, the zero rate usually applies to the whole job when it is supplied and fitted by an installer, including:
It applies to new equipment installed in homes. Your installer should show VAT clearly on your quotation so you know exactly what you’re paying.
The zero rate is currently scheduled to end on 31 March 2027. The government could choose to extend it, but there is no guarantee. Unless further legislation is introduced, installations completed after that date may be charged VAT.
The key word is completed. If your installation hasn’t been finished by the deadline, it may not benefit from the zero rate, even if you received your quotation earlier. That’s why planning ahead matters.
As a simple illustration, an installation priced at £10,000 with 0% VAT would cost £12,000 if the standard 20% rate applied. If VAT were charged at the reduced rate of 5% instead, the same installation would cost £10,500. The exact rate that might apply in future will depend on government policy and the type of installation.
Either way, for most households, installing while the zero rate is in place offers a clear saving on the upfront cost.
As the deadline approaches, demand from homeowners is likely to increase. A solar installation involves several stages, and each one takes time:
Starting the process over the autumn and winter gives you breathing space to make decisions properly, rather than feeling rushed into a choice. It also means your system will be ready to make the most of the longer days in spring and summer. Our guide to the solar installation process explains each stage in more detail.
If you’re considering a battery, it’s worth thinking about it now too. Battery storage also currently benefits from the 0% VAT rate, whether it is installed with new panels or added to an existing system. Installing solar and a battery together can also be more straightforward than adding one later.
No. The VAT deadline is a good reason to start planning, but it shouldn’t be the only reason you choose solar. The most important things are still a well designed system, quality equipment and a reputable installer. A rushed decision can lead to a system that doesn’t suit your home.
Before you commit, it’s worth reading our guide to the 10 questions to ask before choosing a solar installer, so you can invest with confidence.
At Sheerwater Solar, we design every system around your roof, your energy use and your long term plans. We’ll give you a clear quotation, explain the VAT position and agree an installation date that works for you.
If you’d like to install while the 0% VAT rate still applies, book your free survey with Sheerwater Solar and give yourself plenty of time to plan. Our team will assess your property, answer your questions and help you move forward with confidence.
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Reaching out to Sheerwater Solar is straightforward and hassle-free. Whether you’re interested in solar panels for your home or business in Woking, we’re here to guide you every step of the way. You can contact us directly by calling 01932 627 555 or by sending an email to info@sheerwatersolar.co.uk.
Alternatively, fill in our online form for a swift response.
What happens next?
In most cases, we’ll need to conduct an on-site survey at your property to assess the feasibility and provide you with a tailored quote. This visit allows us to understand your specific needs and explore the potential for renewable energy solutions. Following the survey, we’ll discuss the best options for integrating solar energy into your property, including detailed costs and the installation process.
We’re excited to assist you on your journey to renewable energy and look forward to hearing from you.