VAT on solar panels in the UK: the rules and the 2027 change

Do you pay VAT on solar panels?

Not on an installation in a home until 31 March 2027. HMRC's notice sets out the rule. The zero rate covers installing energy-saving materials, which include solar panels with their cabling, control panel and inverter, in residential accommodation and in buildings used solely for a relevant charitable purpose [1]. Installing means fixing the materials permanently in place [1]. The zero rate runs until 31 March 2027, and from 1 April 2027 the reduced rate of 5 per cent applies [1]. Supplying the materials without installing them is standard-rated, currently 20 per cent: a retailer's sale is always standard-rated [1][2].

Residential accommodation includes houses, flats, care homes, student accommodation, self-catering holiday lets, caravans used as a permanent home and some houseboats used as a home [1]. HMRC's description of solar panels covers systems installed in, or on the site of, a building [1]; on our reading, that includes a ground-mounted array in the garden of a home.

Is there still 0% VAT on solar panels in the UK?

Yes, until 31 March 2027. Great Britain has had the zero rate since 1 April 2022 and Northern Ireland since 1 May 2023 [3][4]. As of September 2026, the House of Commons Library says the government had not indicated any plan to extend it beyond March 2027 [3]. Strictly, solar installed in a home is zero-rated, not VAT exempt: the two are different VAT treatments [1][2], but either way you pay no VAT on the installation until the change.

Check before April 2027. If you are planning a job near the change, check HMRC's notice for any update and ask the installer which rate their invoice will carry.

Which VAT rate applies to your job?

Is there VAT on batteries?

Not on one installed in a home, until 31 March 2027. Since 1 February 2024 the zero rate has covered a battery retrofitted to existing solar panels, a standalone battery that stores electricity from the grid, and one that stores both [1]. A battery fitted at the same time as new panels normally counts as part of a single zero-rated supply [1]. Battery prices are on solar battery cost.

Panels, kits and buying the kit yourself

If you buy panels or a kit from a retailer, you pay VAT at the standard rate on it [1]. If you then employ a business to install materials you bought, HMRC says the relief applies to that installation service [1].

Where solar is fitted alongside other building work, HMRC looks at whether it is a single supply or separate supplies. A single price, a package and items not available separately point to one supply, while separate pricing, a gap in time and items that do not depend on each other point to separate ones [1]. A single supply takes one VAT rate, set by its main element, so solar inside a standard-rated building contract such as an extension can be standard-rated as a whole [1]. Ask the installer to show the VAT on each part.

What will 5% VAT add to a quote?

About one twentieth of the price. Using the government's figures for MCS installations on existing homes, April 2025 to March 2026, when installations in homes were zero-rated [1][5][6]:

Prices by size are on solar panel cost.

Is it worth rushing to beat the deadline?

Not on its own. On the figures above, the change adds about one twentieth to the price: worth knowing, but not a reason to skip the checks on the quote or the installer, or to sign before you are ready. If a salesperson uses the date to rush you, see how to check a solar quote.

Which date decides the VAT rate?

Signing a quote or booking a date before 1 April 2027 does not by itself fix the rate. HMRC's tax point rules decide it. For an installation, the tax point is normally when the work is finished, but a payment or VAT invoice before then creates an earlier tax point for that amount [7]. So a deposit paid before 1 April 2027 is normally zero-rated, and a balance for work finished after that date is normally charged at 5 per cent. When a rate changes, HMRC also lets the installer choose the rate in force when the work was actually done, for example zero-rating work finished before 1 April 2027 but invoiced afterwards [7]. If your job could run past 31 March 2027, ask the installer to confirm in writing the VAT on the deposit, each stage payment and the balance.

Not the same as 0% VAT on electricity

Ofgem's price cap information for Great Britain also says there is no VAT on electricity from 1 October 2026 to 31 March 2027 [8]. That is a separate relief on the energy you buy, not on installing panels.