From 1 April 2022, a temporary zero rate of VAT applies to the installation of energy-saving materials in residential accommodation in Great Britain, and the 2019 restrictions on the relief were permanently reversed1. Wind and water turbines were reintroduced as qualifying energy-saving materials1.
The zero rate runs for the period of 1 April 2022 to 31 March 2027, after which the rate will revert back to the reduced rate1. The changes were introduced by Group 23 of Schedule 8 to VATA 1994, as inserted by the Value Added Tax (Installation of Energy Saving Materials) Order 20221.
"These changes were applicable to Great Britain only and did not apply to Northern Ireland"
The manual states the position in three parts, effective from the same date1:
| Change | Detail |
|---|---|
| 2019 restrictions | Permanently reversed in Great Britain |
| Zero rate | Temporary, on installation of energy-saving materials in residential accommodation in Great Britain |
| Period | 1 April 2022 to 31 March 2027, then reverts to the reduced rate |
| Wind and water turbines | Reintroduced as qualifying energy-saving materials in Great Britain only |
| Northern Ireland | Changes did not apply |
The scope of what counts as a qualifying energy-saving material, and how the relief applies to different technologies, is set out in the VAT relief on energy-saving materials guidance, with the qualifying list covered under which energy-saving materials qualify for VAT zero-rating. The treatment of one common measure is covered separately in VAT relief on heat pump installations.
Why it matters for households
VAT is charged on the supply and installation of many home energy measures, so the rate that applies changes the amount a household pays for the same work. For the period covered here, installation of qualifying energy-saving materials in residential accommodation in Great Britain carried a zero rate rather than the reduced rate, and the removal of the 2019 restrictions widened what could be installed under the relief1.
For a home's energy independence, the practical effect is on the cost of measures that reduce reliance on bought-in energy, such as insulation and generating equipment. Wind and water turbines returning as qualifying materials matters for households able to use those technologies, since their installation falls within the same relief1. Households in Northern Ireland are outside these changes, which applied to Great Britain only1.
The relief is time-limited. The zero rate applies to 31 March 2027 and then reverts to the reduced rate, so the rate in force depends on when the installation is carried out1. The end date of the relief is covered in more detail, and the wider framework sits within UK home energy regulation and policy.
What happens next
The zero rate is stated to run to 31 March 2027, after which the rate reverts to the reduced rate1. No further dated steps are given in the manual beyond that reversion.