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Holy Zero Percent, VATMAN!

Updated: Jun 8, 2023

We have finally had confirmation from HMRC today (7/4/2022) that most domestic installations of air conditioning will now be VAT free to the end user from 1st April 2022 (it's not an Aprils Fool's we promise)

Here is a quick summary:

  1. The units must be permanently installed (not mobiles)

  2. They must be capable of heating (we don't sell cooling only anymore)

  3. It includes all installation materials and labour

  4. You can see the full HMRC Release here

What does this mean for you the installer?

Basically you get to offer you customers the complete installation at a VAT free price. You will still pay VAT on all the materials and equipment you buy but you will able to claim back that VAT as part of your VAT return. Here is an example:

Say you quote Mrs Miggins £1000 to install a 2.5kw wall mount, here is the process.

1. You buy the kit and install materials for £400 plus VAT (£480)

2. You invoice Mrs Miggins £1000

3. On your VAT return you mark this as a zero rated transaction

In the old days, you would have charged £200 VAT and paid £120 of that to the HRMC. Now the HMRC owes you £80 instead. If all of your installs are domestic then chances are you will end up with a rebate. If only some of your installs are domestic the amount your usually pay the HMRC will just be reduced.

How Can We Help?

We have a dedicated webpage for homeowners to better understand the technology, benefits and find an installer. If you would like to be included on this database please fill in our form

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