0% VAT on Solar Panels: What Happens When It Ends?

At the moment, solar panels in the UK come with 0% VAT. That’s not a discount, not a rebate — just straight-up no VAT on the kit or the install.

It’s one of the biggest cost reductions solar’s ever had.

But it’s also time-limited, which raises the obvious question:

What happens when it ends — and does that mean you should rush?

Let’s unpack it properly.

What the 0% VAT Rate Actually Means

Right now:

• Solar panels
• Battery storage
• Installation labour

are all VAT-free for domestic installs.

Under the old system, these were charged at 20% VAT — which adds up quickly on a system costing several thousand pounds.

This isn’t a loophole. It’s a government policy designed to accelerate renewable adoption.

How Much Difference Does 0% VAT Make?

On a typical Scottish solar install, 0% VAT can mean:

• £1,000–£2,000+ saved upfront
• No forms
• No claims
• No admin

It’s automatically applied by the installer.

In real terms, it shortens payback and reduces the upfront sting — which is why it matters.

When Is the 0% VAT Rate Due to End?

The current policy is scheduled to run until at least March 2027.

That doesn’t mean:

• It will end then
• Or that it won’t be extended

But it does mean:

• There’s no guarantee it’ll stay forever
• Planning around it is sensible

Anyone claiming they know exactly what will happen is guessing.

What Happens If VAT Goes Back to 20%?

If VAT returns to 20%, solar installs would simply cost more.

That’s it.

No new grants magically appear.
No offsetting incentives guaranteed.

A system that costs £10,000 today would cost closer to £12,000 overnight — for the same panels, same roof, same electricity.

Nothing else changes except the price.

Should You Rush to Install Solar?

Short answer: no — but don’t ignore it either.

Solar should never be rushed just to beat a deadline. A badly designed system installed quickly is still a bad investment.

That said, if:

• You’re already considering solar
• Your roof’s suitable
• The numbers make sense

then locking in 0% VAT is a genuine financial advantage — not marketing fluff.

Think considered timing, not panic buying.

The Scottish Angle

In Scotland, where:

• Solar payback is steady rather than rapid
• Winter output is lower
• Long-term thinking matters

0% VAT helps tip the balance.

It doesn’t make bad solar good — but it does make good solar better.

A Common Mistake to Avoid

Waiting for:

“Something even better next year”

Maybe it happens. Maybe it doesn’t.

What does tend to happen is:

• Energy prices rise
• Incentives change
• Policies quietly expire

Good decisions are made with the information available — not hypothetical future deals.

The Bottom Line

0% VAT on solar panels is one of the clearest, simplest incentives available right now.

It:

• Reduces upfront cost
• Improves long-term value
• Requires no paperwork

It’s not a reason to rush into solar.
But it is a reason not to drift indefinitely if solar already makes sense for you.

As usual, timing matters — but only when the fundamentals are right.

👉 Thinking About Solar While 0% VAT Is Available?

If solar’s already on your radar, comparing realistic options now lets you see whether the numbers stack up — without pressure.

Compare solar systems and see what 0% VAT means for your home — clear figures, no hard sell.