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Extension of VAT Relief for Energy-Saving Materials to Charitable Buildings and Additional Technologies

  • HMRC has published a new Policy Paper on the extension of energy-saving materials (ESMs)
  • Installations of ESMs in residential accommodation will benefit from a temporary VAT zero rate until 31 March 2027
  • The relief is extended to installations of ESMs in buildings used solely for relevant charitable purposes
  • The scope of the relief is expanded to include electrical batteries, water-source heat pumps, and diverters
  • Certain preparatory groundworks necessary for the installation of heat pumps are also included
  • The changes apply from 1 February 2024
  • The objective is to incentivize the installation of ESMs to improve energy efficiency and reduce carbon emissions
  • The measures are implemented by The Value Added Tax (Installation of Energy-Saving Materials) Order 2024.


Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.


VAT news
VAT news