It is important to note that the relief applies to the service of installation and the goods but only when they are purchased together with the installation service. E.g. if you buy insulation materials from a shop VAT at the standard rate will be charged.
The rules only allow for the VAT relief to apply where the materials are installed in either dwellings or ‘relevant residential property’ (RRP). Consequently, the relief cannot be applied to materials within school buildings such as classrooms but it can apply where installation occurs in staff accommodation or boarding accommodation. Therefore, there would be a 20% VAT cost for solar panels installed on a classroom building but no VAT cost if the panels were on a boarding house. If buildings are mixed use, e.g. boarding and classroom buildings, then HMRC will look at the area that is primarily service by the materials.
There is no provision in the legislation for certification in order to obtain relief but we would expect contractors to request confirmation from schools where the building in question is RRP.
Should you wish to discuss this further, please contact Kieran Smith. For more information on topics relevant to you, view our VAT Bitesize webinars.