renewable energy solutions
Some renewable energy systems are defined as energy saving devices. As such they can attract a reduced rate of VAT of 5%. A zero VAT rate my be applicable on new builds.
Professionally installed renewable technologies, including solar thermal and heat pumps, qualify for a reduced rate of VAT (5%). This reduced VAT rate applies to components and installation costs for specific projects.
The following types of projects are eligible:-
- houses, flats or other dwellings
- armed forces residential accommodation
- children's homes
- hospices
- homes providing care for the elderly or disabled
- institutions that are the sole or main residence of 90% of the residents
- monasteries, convents or similar religious communities
- school and university residential accommodation
- self catering holiday accommodation
- certain buildings solely used for relevant charitable (non-business) purpose
VAT Rates
Solar thermal panels plus air and ground source heat pumps are defined as an energy saving devices by Her Majesty's Revenue & Customs. As such a reduced VAT rate of 5% is chargeable when the installation is for a residential dwelling or building as listed above. The proportion of the installation relating to underfloor heating will be standard rated.
For new buildings, the entire installation may be zero rated for VAT.
Please contact Econic if you need any advice on whether your project is reduced or zero rated
