Purchasing Energy 101 – Can I Get A Reduced Tax Rate On Energy?


Hi folks, I’m Jon Mullen the Energy Evangelist.

Your business might qualify for a 5% discount rate on business energy if it meets one of 3 requirements:-

– It is a charitable or non-profit organisation? But you will have to provide a registered charity number to qualify for this.

– You use at least 60% of your energy for ‘domestic purposes’: For example if your business is also used for residential purposes, such as a care home or self-catering holiday accommodation, or a young persons home. The 5% rate applies to the whole bill if you use 60% or more for domestic purposes. However if it’s less than 60% then only the proportion of energy used for domestic reasons is eligible.

– You have a ‘low’ usage of energy: Low energy usage is usually defined as using less than 1,000 kWh of electricity every month (33 kWh a day), or 4,397 kWh of gas (145 kWh a day).

If you believe your business may qualify for a reduced VAT rate on business electric or gas you will have to submit a VAT declaration form, which you can get from your supplier or broker. You’ll also be able to claim back any over payments from the last four years with the form.

On top of that If you qualify for the discounted VAT rate on business energy you might also be exempt from paying the climate change levy. Give me a call to discuss your situation.

So that’s enough for today.

I’m Jon Mullen the Energy Evangelist. Come and find out how to #SaveEnergySaveMoney at EnergyEvangelist.co.uk

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