Rishi Sunak has confirmed a VAT cut for solar panels and domestic battery storage to drive
down energy bills.
The Chancellor stated, “Today (23rd March 2022), I can announce for the next five years,
homeowners having materials like solar panels…installed will no longer pay 5% VAT– they will
pay zero.
And we’ll abolish all the red tape imposed by the EU. A family having a solar panel installed will
see tax savings worth over £1,000. And savings on their energy bill of over £300 per year.”
The zero VAT applies to domestic battery storage when installed with solar, although retrofit or
standalone batteries would still be subject to 20% VAT. This is a step forward in residential solar,
which can unlock solar’s potential in the UK.
The changes will take effect from 1st April 2022 to 31st March 2027.