HM Revenue and Customs published the tax information and impact note for a temporary zero rate of VAT on domestic electricity in Great Britain on 8 September 20261. The measure covers qualifying supplies of electricity in England, Scotland and Wales for the period 1 October 2026 to 31 March 20271.
The note states that the rate will remain 5% on all other types of domestic fuel UK-wide1. HMRC's guidance on fuel and power sets out the same dates and confirms that during the temporary period qualifying supplies of electricity in Great Britain are liable to VAT at 0%2. The guidance records that the government announced the temporary zero rate on 21 July 20262.
Northern Ireland is treated differently. The guidance states that in Northern Ireland, qualifying supplies of electricity remain liable to VAT at the reduced rate of 5%2. It also states there are no changes to the supplies of electricity that qualify for relief2.
"This measure introduces a temporary zero rate of VAT for qualifying supplies of domestic electricity in Great Britain, for the period 1 October 2026 to 31 March 2027."
Qualifying use is defined in the guidance rather than in the impact note. Supplies of fuel and power for genuine domestic use are eligible for the reduced rate, as are supplies for charity non-business use, supplies within the de minimis limits, and supplies where 60% or more of the amount is for qualifying use2. Where less than 60% is for qualifying use, only the qualifying portion is reduced-rated and the remainder is standard-rated2. The de minimis limits include supplies of not more than an average rate of 33 kilowatt hours per day, or 1,000 kilowatt hours per month, of electricity to one customer at any one of the customer's premises2.
| Nation | VAT treatment of qualifying domestic electricity, 1 October 2026 to 31 March 2027 |
|---|---|
| England, Scotland and Wales | 0%1 |
| Northern Ireland | 5%2 |
The guidance also notes that recharging electric vehicles at public charging points is always treated as standard-rated2. Standing charges and meter rental charges are among the items that follow the treatment of the supply when made by the supplier of the fuel or power2.
Why it matters for households
VAT is one of the components of an electricity bill alongside the unit rate and the standing charge, so a change in the rate changes the total a household pays for the same consumption. For a household in Great Britain, the temporary rate applies to the qualifying electricity it uses in the six months from October 2026 to March 2027, which covers the winter period when consumption is highest. The saving is a reduction in tax on the supply rather than a change to the underlying price of electricity, and it does not alter the standing charge or the unit rate themselves.
The measure is temporary and applies to electricity only. Gas and other domestic fuels remain at 5% across the UK1. Households in Northern Ireland do not receive the zero rate on electricity, because qualifying supplies there remain at the reduced rate of 5%2. The guidance states that the range of supplies qualifying for relief is unchanged2, so the boundary between qualifying and non-qualifying use is the same as before.
For a home's energy independence, the change affects the cost of grid electricity during the period it runs. It does not apply to electricity a household generates and uses itself, and the guidance does not address self-generated supply. The treatment of public electric vehicle charging remains standard-rated2, so charging away from home is unaffected.
What happens next
The temporary zero rate applies from 1 October 2026 and ends on 31 March 20271. The impact note does not state what rate applies to domestic electricity in Great Britain after that date, and no further announcement on the period beyond 31 March 2027 is reported in these documents.