Vat On Solar Panels In Up

Changes to the vat treatment of solar panels and other energy saving materials are not as extensive as first feared.

Vat on solar panels in up.

In an in roof or building integrated pv system the solar panels have a two fold function. In an unexpected easter gift to the solar industry and a modest nfu policy win a proposed hike in vat on solar panels has been dropped a cross party amendment to the finance bill on the 2016 budget exempting installation of energy saving materials from an increase in vat from 5 to 20 was passed without a vote on 22nd march. Cost of panels to rise as vat goes up to 20 while end of feed in tariffs means there s currently no payment for excess electricity sent to the grid. Since you would only get vat back for the power producing part you cannot claim the vat on the total investment costs back.

Following infraction proceedings by the european commission against the uk in 2015 hmrc published a consultation on proposed changes to the vat treatment of energy saving materials. This took effect from 1 october 2019 although the government has stated that the majority of solar. Huge vat rise on solar panels makes. The government has introduced secondary legislation to amend the scope of the 5 rate to comply with european vat rules si 2019 958.

Therefore on receiving presidential assent the supply or importation of specialised equipment for the development and generation of solar and wind energy including deep cycle batteries which use or store solar power will be subject to vat from 1 july 2020. At present vat is charged at the reduced 5 rate on the installation of energy saving materials esms including solar panels in residential accommodation.