How do recent tax rulings affect insulation in the ECO scheme Jan 27, 2020

Tax increases effect insulation costs

The final price paid by consumers for measures which save energy has been increased by the Government as the VAT rate on energy efficient and low carbon solutions for homes has been raised.

Previously the VAT applied to energy efficiency measures such as insulation and low carbon heating technologies like heat pumps, biomass boilers and micro combined heat and power, was at a reduced rate of 5%.

For insulation and low carbon heating the reduced rate could remain available to those who meet a ‘social policy test’ (60 years or over and in receipt of certain benefits or a ‘relevant housing association’).

The reduced rate may also apply when the value of the materials does not exceed 60% of the consumer costs for installing the energy saving measure.

YES are expressing concerns that the rulings don't align with ECO funding and are in discussions with several organisations.

The changes remain consistent with the requirements of existing legislation governing the application of VAT in the EU.

Find out more about the VAT legislation here.

YES Energy Solutions are always on the lookout for PAS2030 accredited installers keen to submit work via the ECO scheme.

We currently have good funding rates available and our experienced compliance team support installers with amendments and queries.

YES also provide free compliance training and a technical monitoring team that offers support and advice.

Our ECO funding facilities cover all the main measure types including:

  • Dual measures - primary insulation measure (excluding loft insulation) accompanied with a secondary boiler measure.
  • First time central heating systems
  • Replacement boilers
  • Electric storage heater upgrades & replacements
  • Cavity wall insulation
  • External & internal wall insulation
  • Loft insulation
  • Under floor insulation
  • Room in roof insulation

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