how to get Solar & Battery Equipment without paying VAT

[ExArmy]

so for a while now the government has zero rated VAT for the entire installation of solar panels and a load of other "energy saving materials", and the scheme was recently expanded to include batteries. info here:https://www.gov.uk/guidance/vat-on-energy-saving-materials-and-heating-equipment-notice-7086

but if I'm not registered for VAT, I can't seem to find a simple way of getting the materials without paying VAT on them?

A while ago I did think about actually setting up a company to do solar installs (but wanted to keep it separate from my main electrical business which isn't VAT reg and will never be) and according to my accountant this was "legit" but the general feeling was it would be looked upon by HMRC as VAT evasion and probably not end well which I agreed with.

after some thought on the matter I have decided that I don't want to set up a solar business to offer PV installations, it seems like too much hard work for not enough reward. But, there is the possibility of me setting up a separate solar company simply for the purpose if getting solar kit & batteries for my own house without paying VAT on them.

1. I set up a new company, lets call them Exarmy Solar , and register that company for VAT
2. the new company buys the kit, around £10,000 inc VAT
3. My existing elec company then installs kit in my house and invoice "Exarmy Solar" for £500 installation charge, lets say they subcontracted the job out
4. I then pay "ExArmy Solar" the sum of £10500, £10000 materials and £500 for installation
5. Exarmy solar then pays my electrical company £500 for the installation
6. from receiving that £500, I have to pay income tax on, ~£150)
7. Exarmy Solar then claims the VAT back on the materials, which is £1667
8. and then dispand the solar company
9. total saving £1667-£150 = £1517

I don't know if that will work or not, and to me it doesn't seem unlawful but would appreciate some thoughts on it.

the other option of course is pay a company to supply and install the kit, but the problems with that I forsee are the company just install whatever kit they can get, normally the cheapest, and it will be installed in a hurry with no care or attention to detail, (Yes I've seen many of these installs before)

 

[Andy™]

that's a lot of hassle for £1517

 

[binky]

some points you havn't conisdered. VAT returns are quarterly, so you won't get VAT back for 3 months.There's some fees tp pay in registerering and then delisting a comapany. VAT claims will immediately attract the attention of HMRC, so you will have to spend time (money) to send them documentation requested - I can't remember what they asked for, but it cost at least a days work sorting it out.

If you go to the trouble of setting up a solar company, why not run with it, it pays more than normal electrical work, and being VAT registered is great for buying capital items like a new van.

Locked to prevent being hi-jacked (again)