Close form

Increase your property value and reduce costs with eco-friendly solutions and save VAT!

15 June 2022
Mark Friend
Property Owners, Building & Construction, Reducing Tax

With energy costs going through the roof it could make sense to make small eco-friendly improvements to your property which can reduce running costs and also add value to your property.

In our recent property newsletter (only available to clients of Friend & Grant) we highlighted four ways you can boost your property value and help the environment:

  1. Upgrade your insulation – particularly solid wall insulation which although costly to upgrade, could boost your property value by 3%.
  2. Upgrade your boiler – this can provide increased efficiency and longevity and could boost your property value by up to 1.9%.
  3. Install a charging port for electric cars – this can cost less than £1,000 and could boost your home’s value by 1.5%.
  4. Get double-glazed windows – could increase your property value by 3%.

In the Spring Statement the Chancellor made some important announcements to incentivise certain businesses and individuals to go more green through the installation of energy savings materials (ESM). Previously under the EU there were restrictions on ESM which meant in most circumstances VAT had to be charged at standard rate.

From 1 April 2022 for a period of five years in Great Britain (the rules remain unchanged for Northern Ireland) these ESM supplies have become zero-rated and restrictions placed on the provisions in 2019 were permanently reversed which means that in the worst case scenario in five years’ time the rate on ESM will be 5%. In the listing above items 1) and 2) are now covered by the reduced rating.

A contractor may now zero-rate the supply and installation in residential property of all the following:

  • central heating and hot water system controls;
  • draught stripping;
  • insulation;
  • solar panels;
  • wind and water turbines;
  • ground source heat pumps;
  • air source heat pumps;
  • micro combined heat and power units;
  • wood-fuelled boilers.

Further information on the application of the zero rate to these supplies from 1 April 2022 to 31 March 2027 can be found at VAT notice 708/6.

A word of warning: the legislation is very detailed and states that the zero-rating applies to all qualifying installations. What constitutes a qualifying installation needs to be reviewed carefully. Firstly the installation must take place in qualifying buildings which are dwellings or are used for a ‘relevant residential purpose’ (care homes, etc). Secondly if the installation is part of a larger contract then again eligibility may be denied. As with anything tax related we always recommend you seek professional advice from your adviser.

If you are a client of Friend & Grant and want to find out more about ESMs then please contact

The content in this blog is correct as at 15 June 2022. See terms and conditions.

Similar articles

27 June 2022

Is serviced accommodation a good investment?

Property has been a popular investment for many years and some people view their property portfolio as their retirement pot, particularly where their conventional pension is unlikely to produce sufficient income for their lifestyle. Buy to lets, commercial property investment and furnished holiday lets are all popular, but recently they have been joined by a ‘new kid on the block’ the serviced accommodation and this sector is growing substantially.

girl and grandfather
24 June 2022

Have you considered trusts for holding family investments?

In a recent blog we looked at using a company to hold property investments, however an alternative (and sometimes overlooked) vehicle for ownership of all family investments, property or otherwise, is through a trust structure.

9 June 2022

Redefining Success and 2022 Vision

I’ll start this with the same thoughts that many of us all had back in early 2020, a vision of the world going just a little bit crazier every day. For me it initially evoked an emotion of fear, of the anxiety of the unknown and what might happen, the day-to-day monitoring of numbers of infections, the responsibility to keep a team safe, the tenuous and treacherous emotional reliance I placed on the preparation of our government to guide us through the virus and the emerging clarity that came with half-baked solutions and a gaping chasm of guidance that came from the ‘solutions’ offered.

Our 3 step risk-free guarantee puts your mind at rest and keeps us on our toes!

byrant house at night office

Book Your Discovery Meeting

Are you hungry for success? If you run a small to medium size business and you want to grow your sales, increase profitability and pay less tax then you have come to the right place.