How do I know if my business qualifies for 5% VAT or CCL exemption?

This depends on the type of organisation, the activities you do and the amount of electricity that you use.

Definitions

• Climate Change Levy (CCL): An environmental tax charged per kWh of energy you use. It encourages businesses to use less carbon. The proceeds go towards boosting renewable energy in the grid.

• Value Added Tax (VAT): A tax added to most products and services. VAT is normally charged at 20%. But, for some qualifying businesses, it's 5%.

Qualifying through your organisation’s status or activities

You receive these rate changes if your organisation meets any of these criteria: 

• You’re a charitable or non-profit organisation 

• You provide residential accommodation (e.g. a children’s home or care home for the elderly) 

• Your business is a self-catering holiday accommodation, house boat, caravan or the primary residence for over 90% of the people living there 

• You carry out charitable, non-business activities (excluding sales of donated goods, hire of charity-run buildings and benefits from membership organisations)

If less than 60% of your energy usage goes towards one of these activities, you’ll get reduced rates on that part of your consumption. If it’s more than 60%, you’ll get reduced rates on all of your consumption.

To claim your VAT reduction and CCL exemption, just fill in this form. We’ll then apply it to all eligible invoices - past and future.

Qualifying through low usage

You can also qualify if you meet either of these criteria:

• Your average daily electricity usage is less than 33 kWh

• Your average monthly usage is less than 1,000 kWh

If this is the case, you don’t need to do anything. We’ll do apply this for you on your monthly invoice.