HMRC have set-out the VAT liability that applies to the various energy support schemes that will be paid this winter (from 1 October 2022 up to and including 31 March 2023), which are:
- the Energy Bill Relief Scheme
- the Energy Price Guarantee
- the Energy Bills Support Scheme
Please see paragraph 2.9 of the Fuel and Power notice for the full text, but the main points are below:
The Energy Bill Relief Scheme
- Applies to non-domestic customers in Great Britain
- Payments made to suppliers are grant payments and outside the scope of VAT
- VAT is only due on the amount suppliers actually charge their customers for energy supplied
The Energy Price Guarantee
- Applies to domestic customers in Great Britain (England, Scotland and Wales)
- Households in Northern Ireland will benefit from The Northern Ireland Energy Price Guarantee instead
- Payments made to suppliers are grant payments and outside the scope of VAT
- VAT is only due on the amount suppliers actually charge their customers for energy supplied
The Energy Bills Support Scheme
- Applies to domestic customers in Great Britain (England, Scotland and Wales)
- Provides £400 non-repayable contribution for domestic customers in Great Britain (England, Scotland and Wales)
- Energy suppliers are required to account for VAT under the normal rules as the payment is made for a taxable supply of energy
14 November 2022 
Andrea Marshall, Tax Specialist
