The Government has introduced a temporary reduction in VAT on qualifying domestic electricity supplies, from 5% to 0% between 1 October 2026 and 30 June 2027, following an extension announced in the recent Budget.
Importantly, the legislation specifically includes self-catering holiday accommodation, meaning that qualifying holiday lets can also benefit from the reduction.
We would encourage owners to check their electricity bills to ensure the correct VAT rate is being applied from 1 October. The change should be applied automatically by electricity suppliers, but if your bill continues to show 5% VAT on qualifying electricity supplied during this period, it may be worth contacting your supplier to query this.
Please note that the reduction applies to electricity only, not gas or other domestic fuels.
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