White rendered house with black solar panels on the roof and a Tesla Powerwall 3 on the wall

Budget 2026 · VAT update

0% VAT on solar, batteries and heat pumps ends on 31 March 2027.

The Chancellor's Budget on 28 October 2026 left the deadline in place. From 1 April 2027 every home installation of solar panels, battery storage or a heat pump carries 5% VAT. Here is what it means in pounds, which rate your job will get, and how to secure an install before the change.

Book a survey before the deadline What the Budget changed

Key dates

What changes, and when.

What	Now	Change	Notes
Solar panels, battery storage, heat pumps and other energy-saving materials (installed)	0% VAT	5% VAT from 1 April 2027	Not extended in the Budget. The zero rate has run since 1 April 2022 (batteries added 1 February 2024).
Domestic electricity bills (Great Britain)	0% VAT since 1 October 2026	5% VAT from 1 July 2027	The Budget extended this by three months, from 31 March to 30 June 2027. Gas stays at 5%.
Boiler Upgrade Scheme heat pump grant	£7,500, or £9,000 for oil and LPG homes	Enhanced £9,000 rate closes 31 March 2027	Voucher applications are installer-led. Vanadium applies for you.
Public and workplace EV charging	20% VAT	Confirmed in law from 1 November 2026	Home charging on a domestic supply is unaffected. Home charger installation has always been 20%.

Checked against HMRC guidance and the Budget documents on 28 October 2026. General information, not tax advice: the VAT treatment of your own job is confirmed on your quote.

In pounds

What 5% adds to a typical job.

Illustrative installed prices. Your quote will show the exact figure and the VAT rate that applies.

Solar panels with a battery
typical 4 kW array with 10 kWh of storage
To 31 Mar 2027
£12,000
From 1 Apr 2027
£12,600
£600 more for the same system.
Tesla Powerwall 3, battery only
from our installed price
To 31 Mar 2027
£7,500
From 1 Apr 2027
£7,875
£375 more for the same system.
Air source heat pump
before the £7,500 grant comes off
To 31 Mar 2027
£15,000
From 1 Apr 2027
£15,750
£750 more for the same system.
Commercial rooftop solar (no relief, 20% either way)
business premises never qualified
To 31 Mar 2027
£72,000
From 1 Apr 2027
£72,000
Commercial installations were never zero-rated; nothing changes.

Which rate applies to you

It depends on when the work is done and paid for.

01
Installed and commissioned by 31 March 2027
0% on the whole job. The standard case for anything we survey this autumn and winter.
02
Deposit or stage payment made before 1 April 2027, install afterwards
The amount paid before the change is taxed at 0%. The balance paid after is taxed at 5%. VAT is fixed by the tax point: completion of the work, or an earlier payment or invoice for that amount.
03
Everything paid and installed from 1 April 2027
5% on the whole job. Still far below the 20% that applied before 2022, and the Boiler Upgrade Scheme grant continues.

We do not play games with invoice dates. If a job cannot realistically be finished before April, we will say so at the survey and quote it at the rate that will actually apply.

Covered by the 0% rate until March

What qualifies.

Solar panels (solar PV) fitted to a home, including the inverter and mounting
Battery storage: with new solar, added to an existing system, or on its own charged from the grid
Air source, ground source and water source heat pumps, including the groundworks
Smart diverters that send spare solar to your hot water
Insulation, draught-proofing, and heating and hot water controls
The same items installed in a building used solely by a charity or as a village hall

Always 20%

What never qualified.

EV chargers. Domestic charger installation is 20% VAT and was never in the relief.
Equipment supplied without installation. Buying panels or a battery to fit yourself is 20%.
Business premises, hotels, hospitals and new builds sold as a package (different rules apply).
Repairs and maintenance of an existing system, unless energy-saving materials are being installed.

The full list is in HMRC VAT Notice 708/6.

Budget, 28 October 2026

The energy measures that affect our customers.

Energy-saving materials: No extension. The 0% rate on installing solar, batteries, heat pumps and insulation ends 31 March 2027 and reverts to the 5% reduced rate.
Electricity VAT: The temporary 0% rate on domestic electricity in Great Britain, introduced on 1 October 2026, runs to 30 June 2027 instead of 31 March. The Treasury expects it to take about £50 off the April 2027 price cap.
Gas standing charges: To be abolished during 2027, with the cost moved into the unit rate. Ofgem will set the detail. Electricity standing charges are to be reformed later.
Household Energy Payment: £100 for homes in England in council tax bands A to D, paid from January 2027 through local authorities.
EV charging: Public and workplace charging is confirmed as a non-domestic supply from 1 November 2026, so it carries 20% VAT and Climate Change Levy. New funding from spring 2027 is to cut the cost of slower public chargers.
Boiler Upgrade Scheme: Grants of £7,500, or £9,000 for oil and LPG homes, continue to 31 March 2027, and the scheme is funded beyond that. The enhanced oil and LPG rate closes on 31 March 2027.

Official information

Read it from the source.

Questions we are being asked

VAT questions, answered.

Is VAT on solar panels going up?

Yes. Installing solar panels in a home has been 0% VAT since April 2022. That zero rate ends on 31 March 2027 and from 1 April 2027 the rate is 5%. The Budget on 28 October 2026 did not extend it.

Does the change apply to batteries and heat pumps too?

Yes. The same zero rate covers battery storage (with solar, retrofitted or standalone), air, ground and water source heat pumps, smart diverters, insulation and heating controls. All of them move to 5% on 1 April 2027.

How much more will I pay from April 2027?

Five percent of the installed price. On a £12,000 solar and battery system that is £600; on a £7,500 Tesla Powerwall it is £375; on a £15,000 heat pump it is £750. Every Vanadium quote states the VAT rate that applies to it.

I have already paid a deposit. Which rate do I get?

The VAT rate is set by the tax point. Money paid before 1 April 2027 is taxed at 0% even if the install happens later; the balance paid after the change is taxed at 5%. If the whole job is installed and commissioned by 31 March 2027 it is all 0%. We state the VAT treatment on every quote and invoice.

Can I buy the equipment now and have it fitted later?

No. The relief is for installation, not supply. Equipment bought without installation is 20% VAT, so splitting the job costs more, not less.

Are EV chargers 0% VAT?

No. EV charger installation has always been standard-rated at 20% and is not affected by this change. From 1 November 2026 public and workplace charging is also confirmed as 20% VAT. Charging at home on your domestic supply keeps the domestic rate, which is 0% in Great Britain until 30 June 2027.

Does the Boiler Upgrade Scheme change?

The £7,500 grant, and the £9,000 rate for homes heated by oil or LPG, both run to 31 March 2027. The grant comes off the quote and Vanadium applies for the voucher. The scheme is funded beyond March 2027, but the £9,000 oil and LPG rate closes then, so apply early.

Is there still time to install before 31 March 2027?

For most homes, yes, but the queue gets longer every week. Solar and battery jobs need a survey, a design, a DNO (network) application and scaffolding. Heat pumps need a heat-loss survey and a grant voucher. Book the survey now and we will tell you honestly whether a pre-April date is realistic.

Will the 0% rate come back?

There is no announcement to that effect. After 31 March 2027 the 5% reduced rate applies with no end date. This page was last checked on 28 October 2026 and we will update it if the position changes.

Beat the deadline

Book a survey and lock in the 0% rate.

Tell us about the house and what you are thinking of: solar, battery, heat pump or all three. We come back within one working day with a survey date and an honest view on whether a pre-April install is realistic. Prefer to talk? Call 0330 320 1500.