0% VAT on Solar Panels and Batteries

If you install solar panels or a battery in a home in the UK at the moment, the installation carries 0% VAT rather than the standard 20%. It's the government's energy-saving materials relief, it applies automatically, and it runs until 31 March 2027. This page explains what it covers, because the detail matters when you're comparing quotes.

What qualifies

The zero rate applies to the installation of energy-saving materials in residential accommodation (and buildings used solely for qualifying charitable purposes), when the equipment is supplied and installed together by one contractor. For our work that means:

• Solar PV systems - the panels, inverter, mounting, cabling and the labour, when supplied and fitted as one installation.
• Battery storage - including batteries fitted alongside solar, and standalone batteries installed on their own. Standalone battery storage was added to the relief from 1 February 2024, so a battery-only installation qualifies in the same way.
• Ground-mounted and flat-roof systems - the mounting and installation work is part of the same supply.

There's no form to fill in and nothing to claim back. The installer applies the rate on the invoice, which is one reason a quote for a domestic solar or battery installation shouldn't show a VAT line adding 20% to the total.

The arithmetic

0% VAT is a straight saving against what the same installation would cost at 20%. On a £7,000 solar and battery installation, the difference between the two rates is £1,400. Against the 5% reduced rate that follows the relief, it's £350. Those are tax sums, not performance claims - what your installation actually costs and saves depends on the system and the property, and we model that from your usage as part of the quote.

What happens in 2027

The zero rate runs until 31 March 2027. From 1 April 2027, qualifying installations are due to return to the 5% reduced rate rather than 20%. Nothing is being claimed back from anyone and existing installations aren't affected - it's the rate charged on new installations that changes. If you're planning solar or a battery anyway, the calendar is worth knowing about.

What doesn't carry 0%

Not everything we install qualifies. Domestic EV charger installations are charged at the reduced 5% rate rather than 0% - different relief, different rules. General electrical work like consumer unit upgrades and rewires is standard-rated unless it forms part of a qualifying installation. If you're ever unsure what rate applies to something in your quote, ask, and it should be clear on paper which parts carry which rate.

MCS and the Smart Export Guarantee

The VAT relief doesn't depend on who installs the equipment, but exporting for payment under the Smart Export Guarantee does - SEG payments require an MCS-certified installation. We're MCS-certified (NAP-66870, administered through NAPIT), and we provide the documentation your electricity supplier needs to set up export payments, so the VAT saving and the export income both work together.

Getting a quote

Every quote we issue for domestic solar panel and battery installations applies the correct rate, shows the equipment and labour, and models the expected performance from your actual usage. Get in touch for a free survey - or read more about solar panel installation and home battery installation across Greater Manchester, including whether solar panels are worth it for your property.