Leading heating controls manufacturer Honeywell is reminding installers to clarify the level of VAT payable on energy saving devices as this could lead to lower quotes and increase savings.
Guidelines from the HM Revenue and Customs (HMRC) suggest that heating controls should qualify for a lower rate of tax at 5%, so Honeywell is urging installers to check with their tax advisors to see if they can reap the benefits of this. Not only will this mean savings can be passed onto the customer, making the installation a more attractive proposition, but it will potentially help installers with their cash-flow by being able to pay less for certain products.
The regulation says: “The lower VAT should apply if the energy saving product is being installed into residential accommodation or to a building used solely for charitable purposes.”
With this in mind, installers need to be prepared to prove that the product is being used in one of these situations.
“This reduced rate could be very beneficial to both installers and their customers, so it really is worth checking about these regulations.”