Can your business reclaim VAT on buying and installing EV chargers?

Buying and installing a charger at existing commercial premises normally attracts 20% VAT under HMRC's standard-rating rules [S1]. Recovery depends on your VAT registration, taxable business use and evidence; exempt activities can restrict it [S2]. Establish which business receives the installation before comparing funded offers. Check your treatment with your accountant. Checked October 2026.

Last checked 17 October 2026

What VAT rate applies when your business buys a charger?

For a normal supply and installation at existing commercial premises, budget for standard-rate VAT at 20%. Registration affects recovery, rather than creating an installation exemption. [S1]

Keep this purchase question separate from VAT on charging sales. Your installation invoice and the receipts issued to drivers concern different transactions. When comparing quotes, request the price before VAT, VAT amount and amount payable.

Ask for equipment, installation, groundworks and connection works to be itemised. This helps you see whether two offers cover the same project. Do not compare a hardware price before VAT with another supplier’s complete installation price including VAT.

Can you reclaim VAT on charger purchase and installation?

A VAT-registered business can normally recover input tax for its taxable business activities, subject to the normal conditions. If you are not registered, budget on the gross cost unless your accountant establishes a valid recovery route. [S8]

The supply must be to the business claiming the input tax. [S1]

Use an evidence checklist before placing the order:

• Put the intended customer business on the contract and invoice.
• Obtain the supplier’s VAT registration number and a description of the goods and services.
• Check the tax point, price before VAT, rate and VAT amount.
• Retain purchase invoices, credit notes, payment records and relevant correspondence. [S3]

A card payment confirmation is useful for reconciling expenditure. Request the VAT invoice as well; it is HMRC’s primary evidence for recovery. Make the customer identity clear where a property owner, tenant and operating company are all involved. [S3]

What if your business is partly exempt or has private use?

Taxable supplies, exempt supplies and non-business use need separate analysis. Under Notice 706, costs used exclusively for taxable supplies can normally be recovered in full. Costs attributable to exempt supplies are normally restricted, subject to the de minimis rules. Shared business costs go through the applicable partial exemption method. [S2]

For example, a landlord with exempt rental income should not infer that all charger VAT is recoverable simply because charging creates some taxable income. Equally, an exempt activity does not automatically block input tax directly attributable to a separate taxable activity. Review the actual use and cost allocation. [S2]

Private or non-business use needs an allocation before the business partial exemption calculation. Your accountant should document the method rather than choose an arbitrary recovery percentage. [S1], [S2]

What does VAT do to the installation budget?

This is an illustration, not a quote. Assume an itemised project invoice of £10,000 before VAT at existing commercial premises. The amount is an arithmetic assumption, not an installed charger price benchmark. No grant, finance charge or tax deduction is included. Apply the standard rate from Notice 700. [S1]

VAT = £10,000 × 20% = £2,000. Amount payable = £10,000 + £2,000 = £12,000. The recovery scenarios below are assumptions to show the calculation, not eligibility decisions.

For the middle row: £2,000 × 60% = £1,200 reclaimed; £12,000 − £1,200 = £10,800. The recovery assumption changes project cost by £0–£2,000 here. It does not change the initial £12,000 invoice. Allow for the timing of your actual VAT claim when planning cash needs.

Replace every assumption with your quotation and accountant-confirmed recovery position. Carry the resulting capital cost into the income and payback tool. This VAT calculation does not forecast charging demand, yearly profit or the time needed to recover the investment.

Who claims VAT when a funder owns the charger?

Under fully funded arrangements, the funder buys and owns the equipment. Your host business cannot claim the funder’s purchase VAT merely because the charger stands on your land; input tax follows the recipient of the supply. [S1]

For part funded offers, request a schedule identifying each party’s purchases and invoices. For self funded offers, ensure the customer details match your purchasing business. These checks should happen before you compare contributions or sign the agreement.

Your rent or revenue-share receipt needs its own VAT classification. Notice 742 distinguishes interests in land, licences to occupy and parking rights. A lease label does not settle the treatment of every funded arrangement. Give your accountant and solicitor the full agreement, including access, exclusivity and bay-use rights. [S5]

Does a grant reduce the VAT on the installation?

A grant is not automatically a supplier discount. Notice 700 says grants without a direct benefit to the payer can fall outside VAT. That does not by itself remove VAT on the purchase the grant supports. Reconcile the award, invoice and payment trail with your accountant. [S1]

For a quotation review, request separate entries for the gross invoice, funding paid towards it and the balance you must pay. Ask whether the award calculation includes recoverable VAT. Check that point against the particular scheme’s terms rather than applying one assumption to all grants.

Use UK government EV charging schemes to find the relevant funding route. Keep grant eligibility and VAT recovery as separate checks in your project file.

Do domestic or solar VAT rules change a commercial installation?

Domestic electricity rules concern the energy supply. They do not establish relief for purchasing charging hardware or commercial installation works. [S6]

Notice 708/6 provides time-limited zero rating through 31 March 2027 for specified energy-saving installations in residential accommodation and qualifying charitable buildings. Solar panels and electrical battery storage appear in that relief framework. Ordinary commercial premises do not qualify simply because equipment supports decarbonisation. [S4]

If solar, batteries and chargers appear in one proposal, ask the installer to explain whether there are separate supplies or a principal supply with ancillary works. A single package price does not automatically make every component zero rated. Notice 708/6 describes how to assess those combinations. Check the conclusion with your accountant. [S4]

Read VAT on commercial solar and batteries before comparing a combined project with separate quotations. Keep the building use and contractual scope visible in both offers.

Qualifying new-dwelling construction is a separate case: Notice 708 includes charging points in its building-materials guidance. That does not establish relief for an existing business car park. [S7]

What should you do next?

Gather the quotation, proposed ownership structure, VAT status, expected charger use and any grant terms. Ask your accountant to confirm the rate, recovery and record requirements before signing. Describe the parking and access rights clearly when reviewing a funded contract with your solicitor.

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