Do you pay VAT on batteries in the UK?
It depends on what kind of battery and how you buy it. Ordinary consumer batteries (AA cells, power tool packs, laptop batteries) carry standard 20% VAT. Home battery storage systems are different: when supplied and installed as a single job in a residential property, they are zero-rated for VAT until 31 March 2027. The same zero rate covers solar panels, heat pumps, and insulation under the government's energy-saving materials policy.
This distinction trips a lot of people up, because the phrase "VAT on batteries" covers both cases. If you are researching a home energy storage system, the rest of this guide is about you.
Where the 0% rate came from
Since 1 April 2022, the UK government has applied a zero rate of VAT to the installation of energy-saving materials in homes. Battery storage was initially only covered when installed at the same time as solar panels. On 1 February 2024, the relief was extended to cover battery storage in its own right. That extension covers three scenarios:
- Standalone batteries, installed with no solar at all, charging from cheap overnight grid electricity (see how battery storage works without solar)
- Retrofit batteries, added to a solar array that was installed years earlier
- Batteries installed alongside new solar panels, as before
The zero rate applies to the whole installed job: the battery, the inverter, cables and mounting hardware, and the installation labour. It applies in England, Scotland and Wales; Northern Ireland has separate arrangements.
What the relief is worth in pounds
| Installed price (0% VAT) | Price if standard 20% VAT applied | What the relief saves you |
|---|---|---|
| £3,500 (small 5 kWh system) | £4,200 | £700 |
| £4,599 (Habo Energy 11.5 kWh) | £5,519 | £920 |
| £6,500 (typical 10–13 kWh quote) | £7,800 | £1,300 |
There is nothing to claim and no paperwork. The installer simply does not add VAT to the invoice. If a quote you receive shows 20% VAT on a fully installed residential battery system, question it, because the zero rate is not optional for qualifying work.
The DIY exception: supply-only purchases pay 20%
The zero rate attaches to the installation service, not the battery itself. Buy a battery unit from an online retailer without installation and it is standard-rated at 20%. This substantially narrows the gap between a DIY route and a professional install: a £4,000 supply-only battery actually costs £4,800 with VAT, before you have paid an electrician anything.
Professional installation also matters beyond the VAT position. UK home battery installations need to comply with BS 7671 Amendment 4 and PAS 63100:2024, the DNO needs to be notified under G98 or G99, and an MCS-certified install protects warranties and export-scheme eligibility. See our guide to vetting a UK battery installer.
The 31 March 2027 deadline, and why it matters now
The zero rate is scheduled to end on 31 March 2027. From 1 April 2027, the rate on energy-saving materials is expected to revert to the reduced 5% rate rather than the full 20%, unless the government extends the relief again.
On its own, 5% is a modest change: £250 to £325 added to a typical installed system. The bigger issue is what else is happening to battery prices at the same time. China cut its battery export VAT rebate in April 2026, and wholesale cell prices are under upward pressure for the first time in years. Our guide to whether UK home battery prices are rising in 2026 covers the full picture, but the short version is that the window where falling hardware prices kept offsetting everything else has closed. Waiting past March 2027 means paying the new VAT rate on top of whatever hardware prices have done in the meantime, while also giving up a year of savings worth £800 to £950 on a tariff like Octopus Go.
Checklist: does your installation qualify for 0% VAT?
- The property is residential (a house, flat, or similar dwelling), not commercial premises
- The property is in England, Scotland or Wales
- The battery is supplied and installed as one job, not bought supply-only
- The installer is a professional firm; at Habo every install is carried out by MCS-certified engineers, and the 0% rate is already baked into our £4,599 all-in price
- The work completes before 31 March 2027 to get the zero rate rather than the expected 5%
0% VAT is already in our price
The Habo 11.5 kWh battery is £4,599 fully installed, VAT-free until March 2027, with MCS-certified installation included. Fully refundable deposit.
Reserve for £49