AOS Blog
How Much VAT Is on Air or Ground Source Heat Pumps?
Thursday 8th February 2024
Are you considering a switch to more energy-efficient heating options, such as air-source heat pumps or ground-source heat pumps? If you're in Hertfordshire or the surrounding areas, you may be wondering about the VAT implications of these environmentally friendly heating systems. In this informative blog post, AOS Energy Efficient Heating Systems Limited, your trusted air source heat pump installers in Hertfordshire, aims to clarify the VAT rates applicable to these eco-conscious heating solutions.
VAT Rates for Heat Pump Installation
Understanding the VAT rates for the installation of air-source heat pumps (ASHPs) and ground-source heat pumps (GSHPs) in the UK is crucial when budgeting for your energy-efficient heating system. VAT rates can vary depending on several factors:
Standard VAT Rate
The standard VAT rate in the UK applies to most goods and services. The rate is currently 20%. However, it's important to check the most current VAT rates, as this can change over time.
Reduced VAT Rate
A reduced rate of 5% VAT is often applicable to the installation of energy-saving materials and products in residential properties. However, to encourage the adoption of energy-efficient technologies, including heat pumps the rate has been reduced to 0% until 1st April 2027.
VAT Relief for Heat Pump Installation
The good news for homeowners considering air or ground-source heat pumps is that they may qualify for a reduced VAT rate when it comes to installation. To be eligible for this reduced rate, certain criteria must be met:
Property Type
The reduced VAT rate typically applies to the installation of ASHPs and GSHPs in residential properties, including houses and flats. Commercial properties may not be eligible for this reduced rate.
Primary Use
The reduced VAT rate usually applies to heat pumps intended for space heating or hot water production. If the heat pump is installed for a different purpose, such as cooling, the standard VAT rate may apply.
Contact AOS Energy Efficient Heating Systems Limited
If you're ready to explore the benefits of air-source heat pumps for your property in Hertfordshire or the nearby regions, AOS Energy Efficient Heating Systems Limited is here to assist you. As experienced and certified heat pump installers, we can guide you through the installation process and help you navigate the VAT implications.
For more information or to schedule your heat pump installation, please visit our Contact Us page. Let us help you make your home more energy-efficient and environmentally friendly.
