As energy costs continue to rise, homeowners across Essex, London, East Anglia and the wider South East are turning to solar panels to reduce their electricity bills and cut carbon emissions. If you’re considering switching to solar, it’s important to understand how VAT applies to solar panel installations and what it covers.
At SolarTherm UK, we make it simple to get the best deals on your solar PV installation, helping you save money while investing in a renewable future.
Is There VAT on Solar Panels in the UK?
Solar panels installed on residential properties in the UK qualify for 0% VAT, meaning you won’t pay VAT on the panels themselves or the cost of the installation. You do need to use the same company for supply and installation to qualify for the 0% VAT rate, if you use one company to purchase your panels and another company to install, you’ll pay 5% VAT on both the panels and the installation costs.
Why Did the UK Government Cut VAT on Solar Panels?
The government introduced the VAT reduction as an incentive for homeowners to invest in renewable energy and potentially improve the energy efficiency of millions of homes across the UK by making solar more affordable. As part of the plans to reach Net Zero by 2050, the UK government aims to have 9 million UK homes with solar installed by 2030. Solar panels currently help over 1.5 million households save money on electricity bills and contribute to a greener future.
How Long Will the 0% VAT Rate Last?
The reduced VAT rate is set to apply until 1st April 2027. After that, the rate will increase to 5%.
Do You Have to Pay VAT on Solar Batteries?
As of February 2024, solar batteries also qualified for the 0% VAT rate, whether fitted with solar panels or retrofitted to an existing system. Solar batteries store surplus electricity generated from your solar panels for use in the evenings or on during low generation periods, giving you greater independence and more control over your energy.
Next Steps: Invest in Solar Panels Today
Over 1.5 million solar panel systems are installed across the UK, a figure that is continuing to grow. With 0% VAT on solar panels and batteries until 2027, there has never been a better time to switch to solar energy.
At SolarTherm UK, we’ll provide a free no obligation quote and design, tailored to your property, usage and future energy needs. No hard sell, just honest, expert advice.
Your home. Your energy. Your future.
