Zero VAT on energy saving products - Solar install on Thursday 31 March 2022 - Help!

VAllen2000

I'm having solar panels and a battery installed on Thursday 31 March 2022. The Zero VAT comes into effect in April and I would save £350. I've asked the company to delay the install but they have said it will need to move until September 2022. 

Would it be cost effective to move the install back until September, there are only 2 of us in the house with 1 electric car? At what point does the VAT get added onto my bill on Thursday 31 March 2022, if I delay paying for a day would the VAT be removed?

I welcome any advice or recommendations, especially if there are any thoughts on what I can say to the solar company so I do not pay VAT on the energy saving products.

Thank you.

tacpot12

VAT is charged at the point the invoice is issued. As long as your invoice is issued after the date that the change comes into force, the supplier should charge VAT at 0% on certain items if the invoice is dated 1st April 2022 or after this. All you can do is remind them about the change, and ask for a correct invoice if they send you one that includes VAT above 0% on the items where 0% should apply. You might want to read up to make sure you know how much of installation will qualify of the 0% rate. The invoice should break down the items into VAT and non-VAT items, and show you the rate of VAT paid on each.   

VAllen2000

Thank you very much Tacpot12 really appreciate your time answering my question.

Chezaban

I’m in a similar position although install not until May luckily, but I wondered if the zero vat applies to batteries installed at the same time? It’s all 5% now but is it all 0%from April?

I can’t find details anywhere and my installer doesn’t know either.,

Jeremy535897

It does not look like it. The new zero rate applies to "energy saving materials" as defined in group 2 schedule 7A VATA 1994:

Meaning of “energy-saving materials”

1For the purposes of this Group “energy-saving materials” means any of the following—

(a)insulation for walls, floors, ceilings, roofs or lofts or for water tanks, pipes or other plumbing fittings;

(b)draught stripping for windows and doors;

(c)central heating system controls (including thermostatic radiator valves);

(d)hot water system controls;

(e)solar panels;

(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(g). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(h)ground source heat pumps;

(i)micro combined heat and power units. air source heat pumps;

(j)micro combined heat and power units;

(k)boilers designed to be fuelled solely by wood, straw or similar vegetal matter.

To this list wind and water turbines are to be added:

"The changes will reverse the 2019 legislative changes and widen the scope of the relief as set out below for installations of ESMs in Great Britain:

• The relief will no longer be restricted by the social policy conditions or the 60% test
• Wind and water turbines will be added back to the list of ESMs
• A temporary zero rate will be introduced with effect from 1 April 2022 until 31 March 2027
• Unless the government introduces further legislation to extend the period of the zero rate, the installation of ESMs will revert back to the 5% reduced rate from 1 April 2027"

From https://www.gov.uk/government/publications/changes-to-the-vat-treatment-of-the-installation-of-energy-saving-materials-in-in-great-britain/the-value-added-tax-installation-of-energy-saving-materials-order-2022