Definition: A zero rate of VAT (0%) means a supply is taxable at a rate of zero: no VAT is added to the price the customer pays, even though the supply itself is inside the VAT system.
So for a home electricity bill in Great Britain during this period: £100 of electricity = £100 in total. No VAT is added.
You can check any other rate with our free VAT calculator — choose 0%, 5% or 20% to see the breakdown.
Enter an amount, pick a rate, and see the full breakdown instantly.
Need more options? Use the full UK VAT Calculator — it's free.
Legislation — the Value Added Tax (Supplies of Domestic Electricity) Order 2026 (SI 2026/987) — temporarily zero-rates supplies of electricity that would previously have qualified for the 5% reduced rate.
No new qualifying conditions were introduced: supplies that qualified for the reduced rate under VAT Notice 701/19 are the supplies that qualify for the temporary zero rate.
Your electricity usage for the month is £120 before VAT.
The same £120 of qualifying electricity in Northern Ireland:
HMRC says that where a billing period includes 1 October 2026, the supplier may work out the VAT based on when the energy was actually consumed. Suppliers are recommended to use meter readings; another fair and reasonable method is also acceptable.
Simple illustration: if £60 of electricity was used in September (5%) and £60 was used in October (0%):
That is why a bill that crosses 1 October may show a split — part at 5%, part at 0%.
Only the electricity element gets the temporary zero rate in Great Britain.
Following VAT Notice 701/19, qualifying use means:
Two practical points from HMRC's guidance:
Business electricity is not covered by this cut and is usually standard-rated at 20% (with existing small-usage exceptions under the normal rules).
If you supply electricity, HMRC advises keeping clear records of when you applied each rate and accounting for adjustments under the normal VAT accounting rules.
For bills at other rates, use our free UK VAT calculator and select 5% or 20%.
This is a temporary measure with an end date of 31 March 2027 in the legislation as enacted. Do not assume the 0% rate continues after that date — check GOV.UK / HMRC guidance near the end of the period for any extension or for confirmation of the rate that applies from 1 April 2027.
Is VAT on home electricity now 0% in the UK?
Only in Great Britain, and only temporarily. Qualifying domestic electricity in England, Scotland and Wales is 0% from 1 October 2026 to 31 March 2027. In Northern Ireland it remains 5%.
Does the 0% rate apply to gas as well?
No. This cut is for electricity only. Domestic gas remains at the reduced rate of 5%.
My bill covers September and October — how is VAT worked out?
HMRC allows the liability to be based on when the energy was consumed, ideally using meter readings. The September part stays at 5% and the October part is at 0% in Great Britain.
Do I need to claim the saving or contact my supplier?
The rate is applied by the supplier to qualifying supplies — it is not a rebate you calculate in the calculator above. If a Great Britain domestic electricity bill for use on or after 1 October 2026 still shows 5% VAT on the electricity element, query it with the supplier.
How much will I save?
Roughly 5/105 of what you would previously have paid. On a £126 electricity bill that previously included 5% VAT, the new total for the same usage is £120 — a £6 saving.
Try it now: enter any amount in our free UK VAT calculator to compare 0%, 5% and 20% side by side.
Related guides: How to Calculate VAT at 5% (Reduced Rate) · How to Remove VAT from a Price (Reverse Calculation) · Current UK VAT Rates