What is the Solar Panels VAT Rate in Ireland?

Solar panels have become one of the most popular home upgrades in Ireland, offering long-term savings and a cleaner way to power your home. With the government now applying a 0% VAT rate on solar panels, the switch to renewable energy has never been more affordable.

Still, many homeowners are unsure how this tax change actually affects installation costs and eligibility. Understanding these details can help you plan better and make the most of available savings. In a country where sustainable living is quickly becoming the norm, knowing how VAT applies to solar panels can have a real impact on your budget and energy future.

In this blog, we’ll explore what is the solar panels VAT rate in Ireland, who qualifies, what’s excluded, and how it benefits Irish homeowners considering solar installation.

Let’s start!

What is the Solar Panels VAT Rate in Ireland?

The government introduced a 0% VAT rate for solar panel installations on private homes to make renewable energy more affordable for homeowners.

Private Dwellings Covered

The 0% VAT applies only to private residential properties. This includes regular houses, apartments, duplexes, and even caravans or mobile homes that are fixed to the ground. The panels don’t have to be installed directly on the roof, you can still qualify if they’re mounted on nearby land beside your home.

Buildings Not Included

Not every property qualifies for the zero VAT rate. Commercial buildings, shops, hotels, B&Bs, and public or industrial buildings are excluded. Properties used mainly for short-term stays, such as guest houses or holiday homes, are also outside the 0% VAT rule.

Ancillary Equipment Included

It’s not just the solar panels themselves that are covered. The 0% VAT also extends to essential system components like controllers, batteries, wiring, and installation labour. This helps reduce the overall setup cost for homeowners investing in solar power.

EV Chargers Excluded

Electric vehicle chargers are not part of the 0% VAT scheme. They continue to be taxed at 13.5% VAT when supplied and installed. This rate is consistent for most charging equipment across Ireland.

Mixed-Use Properties

If your property serves both as a home and a business, for example, living in one half while operating a B&B in the other, you may still get partial relief. The 0% VAT applies proportionally to the residential portion, as long as the electricity generated is shared between both areas.

How VAT Works for Solar Panel Installations in Ireland?

When it comes to solar panel systems, VAT can vary depending on how the panels are purchased and installed. If you buy the panels and have them installed by the same company under one contract, you qualify for the 0% VAT rate, making the entire project more affordable. This approach encourages homeowners to go solar without worrying about extra tax costs.

However, if you buy the panels separately and hire another company for installation, the standard VAT rate applies to the panels, while a reduced rate may apply to the fitting work. This is because the supply and installation are treated as two separate transactions under Irish VAT law.

There’s also what’s known as the two-thirds rule, meaning if the cost of the panels themselves makes up more than two-thirds of the total job price, the VAT rate for goods is applied to the whole contract. Keep in mind that the 0% VAT rate doesn’t extend to movable setups like boats or mobile homes.

What Are The Financial Benefits of 0% VAT for Irish Homeowners?

The 0% VAT rate on solar panels has made it easier and more affordable for homeowners in Ireland to switch to renewable energy.

1. Lower Upfront Installation Costs

With VAT removed, the total cost of purchasing and installing a solar system drops instantly. This means homeowners can save hundreds or even thousands of euros compared to the old 13.5% rate.

2. Faster Return on Investment

Because the initial price is lower, the time it takes to recover your solar investment through energy savings is much shorter. Many households now see a full payback within just a few years.

3. Increased Property Value

Installing solar panels not only cuts energy bills but also boosts property value. Buyers are increasingly drawn to energy-efficient homes, giving solar-equipped houses a competitive edge.

4. Long-Term Energy Savings

The savings don’t stop with installation. Once your system is up and running, you’ll continue to save on electricity costs for years, keeping more money in your pocket over time.

5. Encouraging Sustainable Living

The VAT reduction also encourages more people to invest in renewable energy. It’s a financial win that supports a cleaner environment and helps Ireland move closer to its sustainability goals.

Conclusion

In summary, Ireland’s 0% VAT rate on solar panels has made renewable energy far more affordable for homeowners. The scheme covers most private dwellings and includes key components like batteries and installation work, while excluding commercial properties and EV chargers. By removing VAT, the government has helped reduce upfront costs, shorten payback periods, and encourage greener living.

If you’re ready to make the switch and save on your installation, contact Going Solar today. Our experts can guide you through the process, confirm your eligibility for the 0% VAT rate, and help you start generating clean energy for your home.