Reduced VAT on Residential A/C Installations

As part of its commitment to reducing the emission of gases responsible for global warming, the Government has awarded a reduced rate of VAT to the supply and installation of heat-pump air-conditioning systems in residential properties.

They state that "reducing the rate of VAT will encourage the increased use of such energy efficient products and will have a positive effect in reducing carbon emissions".

Previously, the rate of VAT applied to our residential sales has been the standard 17.5%.  The new rate of VAT on qualifying equipment is now just 5%.

Example saving

The supply and installation of a heat-pump, wall-mounted system is priced at £1250.00 ex Vat.  With VAT applied at the standard rate of 17.5%, the total cost to the customer is £1468.75.

The same job with VAT now applied at the lower rate of 5% reduces the total cost to the customer to £1312.50, in turn providing a saving of £156.25!

When you consider that the electrical consumption of the example heat-pump system is less than a quarter of that consumed by any other form of electric heating,  the savings (both short and long-term) are obvious, in addition to which a facility to cool your home is gained.

To find out more about having air-conditioning installed in your home, visit our residential air conditioning page where you'll find an overview of the products available along with answers to the most Frequently Asked Questions.