Andy Burnham has announced plans to make domestic electricity exempt from VAT, reducing the cost of at-home charging for electric vehicles.
The government has claimed that removing the VAT rate of 5% will save the average household around £45 a year. Based on the current July to September price cap of 26.11p per kilowatt-hour, the average driver could save up to £17.64 per year on home charging, between 24p-78p per charge.
Coming into effect on 1st October 2026, the £45 overall saving would be in addition to the £150 saving previously announced in the last budget.
However, with the VAT cut only applying to domestic electricity, drivers who rely on public charging networks would continue to pay the standard 20% VAT rate when charging.
As the UK continues to implement incentives towards EV adoption, it’s important for all areas of the automotive industry, including incident management partners, to make the transition for motorists as smooth as possible.
Evaluate, the latest initiative from Motor Assist, allows ICE drivers in need of a replacement vehicle to select an EV for an extended real-world test, to experience EV ownership and whether it is a viable option for them in future.
