Do You Pay VAT on Solar Panels in the UK?

The short answer: 0%, for now

Installing solar panels (and other qualifying energy-saving materials) in a residential property in the UK currently carries 0% VAT. This relief has been in place since May 2023 and applies across England, Scotland, Wales, and Northern Ireland.

Why this matters more than it sounds

It's not just that you save 20% on the VAT you'd otherwise pay — it's that this 0% rate is classed as "zero-rated" rather than "exempt." That distinction matters for installers like us: it means the installation still counts as a taxable supply, so a VAT-registered installer can reclaim the VAT it pays on materials and equipment, while still charging customers 0%. In practice, that keeps installation prices competitive rather than pushing them up.

Does it apply to everything?

The 0% rate applies specifically to qualifying installations in residential accommodation. Commercial installations, and any non-qualifying work bundled into a job, are generally charged at the standard rate. If you're getting a quote, it's worth asking your installer to clearly break out what's zero-rated and what isn't.

How long will it last?

The relief is currently set to run until 31 March 2027. After that date, the rate is due to move to 5% (the reduced rate) rather than back up to 20% — so even after the change, solar remains meaningfully cheaper than standard-rated work.

What this means if you're considering solar

If you've been putting off getting a quote, the 0% VAT period is a genuine, time-limited saving on top of the usual case for going solar — worth factoring into your timing if you're on the fence.