Draft legislation: VAT (Reduced Rate) (Energy-Saving Materials) Order 2019
We are seeking views on draft legislation that amends the scope of the reduced rate for energy-saving materials to ensure consistency with EU law.
Detail
Following a consultation in 2015 to 2016, we want your views on updated draft legislation to amend the scope of the VAT relief for the installation of energy-saving materials (ESMs) in residential accommodation. The changes retain as much of the relief as possible, while ensuring compliance with EU law (please see the Court of Justice of the European Union ruling in 2015).
The proposed amendments will:
- maintain the reduced rate on installations of ESMs in residential accommodation for recipients who are aged 60 or over or receiving certain benefits, and for housing associations
- remove the reduced rate for the installation of wind and water turbines
- maintain the reduced rate for all other installations in residential accommodation where the cost of the materials does not exceed 60% of the total cost of installation
Before responding, you can read the documents on this page:
- draft legislation
- draft tax information and impact note
- draft explanatory memorandum
- draft guidance
Documents