VENSAV3040 - Energy-saving materials: insulation

Insulation means materials that are designed and installed because of their insulating qualities. These include:

• walls
• floors
• ceilings
• roofs or lofts
• water tanks, pipes or other plumbing fittings

Products such as curtains and carpets, which are not usually installed simply as insulation, do not qualify for relief.

HMRC also reviewed the VAT treatment of damp proofing products (including paints, gels and creams) that are typically applied to the exterior walls of houses to prevent damp. It concluded that these products do not qualify as energy-saving materials  for the following reasons:

• The main purpose of these products is to water-proof exterior walls rather than improve thermal efficiency
• There is no conclusive evidence that these products improve the thermal efficiency of brickwork
• If such evidence became available, it is likely that any improved thermal efficiency would be incidental to the main purpose of the products which is water-proofing
• The products are not normally described as insulators
• The products are sold (or “held out for sale”) as water-and-damp proofing products and not insulators
• The legislation refers to energy-saving materials being “installed”, which indicates that the legislation more naturally refers to typical insulators such as cavity wall insulation rather than the damp proofing products which are “applied”.

Draught stripping for windows and doors qualifies as an energy-saving material. These are strips of insulation that are fixed around windows, interior and exterior doors, and loft hatches to reduce draughts.