HMRC – 0% VAT on Batteries – Quick Summary

In this announcement, we capture the key factors that will allow you to get VAT Relief for energy storage devices and specifically batteries

2.3 Scope of the relief

The relief applies to the services of installing energy-saving materials in residential accommodation and charitable buildings. For example, where a customer employs a business to install energy-saving materials that the customer purchased directly from a retailer.

The relief also applies to the supply of energy-saving materials by the person who installs those materials in residential accommodation and charitable buildings. For example, where a customer employs a business to supply and install energy-saving materials.

However, if you supply energy-saving materials without installing them your supply will be standard-rated. For example, the sale of energy-saving materials by a retailer is always standard-rated.

2.19 Batteries for storing energy converted from electricity

From 1 February 2024, electrical storage batteries installed in residential accommodations or buildings intended for use solely for a relevant charitable purpose qualifies for the temporary zero rate. These include:

the retrofitting of a battery for storing electricity generated by one or more of the microgeneration systems including solar panels, wind turbines and water turbines (listed in section 2.7) — batteries installed as part of the installation of a microgeneration system listed in section 2.7, normally fall to be ancillary and form part of a single zero-rated supply (read section 2.5).

the installation of a standalone battery for storing electricity from the grid (the mains electricity)

the installation of a battery for storing electricity from one or more of the microgeneration systems (listed in section 2.7) and from the grid