Vat Rate Solar Panel Installation

Changes to the vat treatment of solar panels and other energy saving materials are not as extensive as first feared.

Vat rate solar panel installation.

The installation of certain energy saving materials into any residential accommodation is subject to the reduced vat rate of 5. This took effect from 1 october 2019 although the government has stated that the majority of solar. If work needs to be done on your roof to allow it to bear the load of the solar panels this would also attract the lower vat rate. If however the labour costs of installing energy saving material are greater than the cost of the material itself the labour costs will qualify for a 5 vat rate.

The government has introduced secondary legislation to amend the scope of the 5 rate to comply with european vat rules si 2019 958. Labour costs will still benefit from the reduced rate of 5 per cent vat. Consequently solar panels water turbines and wind turbines along with battery storage systems will no longer qualify for the reduced rate of vat. To qualify you must be over 60 or getting one or more of.

Vat is charged at the reduced rate of 5 on the installation of solar panels in or in the curtilage of residential accommodation. If you do a diy install you will need to pay the full vat rate when you buy your panels. Take note of the two underlined parts as both are applicable in order to qualify for the reduced rate of vat. At present vat is charged at the reduced 5 rate on the installation of energy saving materials esms including solar panels in residential accommodation.

The installer should charge you the lower vat rate on their materials the solar panels and their installation costs. For example a business carries out an installation of solar panels combined with a battery. Installation repair and maintenance of renewable source heating systems the reduced rate is only for the grant funded part of the work. Huge vat rise on solar panels makes installation entirely uneconomic say experts.

Value added tax consolidation act 2010 vatca 2010 ref.