Heat pump grants, 0% VAT and ECO4: what help the UK gives you, and when it runs out

Three deadlines decide what help your house can still get with energy work. ECO4, the supplier-funded upgrade scheme, ends on 31 December 2026 with no successor obligation behind it. The 0% VAT on energy-saving installations ends on 31 March 2027, and so does the £9,000 the Boiler Upgrade Scheme pays toward a heat pump in an oil- or LPG-heated home. Past those dates, the standard £7,500 grant stands with no end date in the guidance this guide checked, and in England the council-run Warm Homes: Local Grant is funded to March 2028. Every scheme on this page is an energy-performance scheme, so the two questions that sort them are which door your house qualifies for, and whether that door is still open when your heating system’s own calendar says go.

The calendar first: what closes, what stays

Which dates bite depends on what your house runs on: an oil- or LPG-heated home has money moving on two of them, a household that qualifies for supplier-funded work loses that door first, and for everyone else the hard date is the VAT reversion.

Scheme	What it pays	Door	Closes
ECO4	Supplier-funded upgrades	Your energy supplier	31 December 2026
0% VAT on energy-saving materials	Zero VAT on installation, labour included	Your installer’s invoice, UK-wide	31 March 2027, then 5%
Boiler Upgrade Scheme, oil/LPG rate	£9,000 heat pump rate for oil- and LPG-heated off-gas-grid homes	Your MCS installer, England and Wales	31 March 2027
Boiler Upgrade Scheme, standard	£7,500 heat pump, £2,500 air-to-air, £5,000 biomass	Your MCS installer, England and Wales	No closing date found
Warm Homes: Local Grant	Fully funded upgrades; owner-occupiers pay nothing	Your council, England	31 March 2028
Home Energy Scotland grant and loan	Up to £7,500 grant, up to £9,000 rural and island, plus optional loan	Home Energy Scotland, Scotland	No closing date found

The two rows without a date are not promises of permanence; they are the schemes whose current guidance names no end date that this guide could verify. And the dated rows close different things: ECO4’s date ends a funding mechanism, the VAT date moves a price by five points, and the £9,000 is a window inside a scheme that continues at £7,500.

The Boiler Upgrade Scheme: £7,500, or £9,000 until March 2027 if you heat with oil or LPG

The standard grant is £7,500 toward an air-to-water or ground source heat pump, in England and Wales. Air-to-air heat pumps carry £2,500, for residential buildings only, under scheme rules in force since 28 April 2026. Biomass boilers carry £5,000 and are eligible only in limited circumstances, with location and air-quality conditions attached. The scheme funds low-carbon heating; a like-for-like gas boiler is not in it.

The £9,000 rate is the one with a clock on it. You get it toward the same two heat pump types if the house is heated by oil or LPG and has no mains gas connection; Ofgem states the rate runs from 21 July 2026 to 31 March 2027. Air-to-air units and biomass boilers sit outside it.

Get quotes from MCS certified installers and instruct one. The installer applies through Ofgem on your behalf and takes the grant off the price you pay; there is no application with your name on it.

Book the installer before you apply, and aim to have the system in well before 31 March 2027. The completion clock runs from the application end rather than the install end: gov.uk gives 120 days from applying, Ofgem gives three months from the application being approved, and six months for ground source. An application filed long before the install date therefore spends that clock instead of banking it, even when the slot is already booked. If it runs out, the installer has to submit a new application, and after 31 March 2027 there is no £9,000 rate left to apply for. The guidance this guide checked does not say which event the closing date turns on, the application or the finished job, which is the reason to get both inside the window rather than only one. The real constraint is how far ahead installers book, so the useful move now is the quote round, not the paperwork.

Three exclusions sit ahead of the quote round: most new builds, social housing, and a property that has already had government funding for a heat pump or biomass boiler. The last one names those two technologies, not past grants in general.

VAT: 0% on energy-saving work until 31 March 2027, then 5%

The installation of listed energy-saving materials in residential accommodation is zero-rated until 31 March 2027, labour included. The list covers insulation, draught stripping, heating controls, solar panels, air and ground source heat pumps, wood-fuelled boilers, wind and water turbines, micro-CHP, and, since February 2024, storage batteries, water source heat pumps and smart diverters. From 1 April 2027 the rate reverts to 5%. Unlike the grants, the relief has no geography inside the UK and no eligibility test on you: there is no application and no claim, because the rate sits on the installer’s invoice.

Read the quote. Confirm the VAT line on qualifying work is zero. Where it shows the standard rate instead, ask the installer which of three things is true: the quote was written without the relief in view and can be re-issued at the zero rate; the work does not qualify, because the material is not on the list or the building is not residential accommodation; or the job mixes qualifying and non-qualifying work, in which case ask for the two on separate lines.

ECO4 ends 31 December 2026, and no successor obligation follows

The decision came in the November 2025 Budget: no successor supplier obligation after ECO4, with £1.5 billion of additional grant funding committed to the Warm Homes Plan instead. ECO4 itself is an obligation on energy suppliers, delivered through them; it was due to end in March 2026 and was extended nine months to let suppliers meet their existing targets and fix non-compliant installations.

Eligibility runs through your energy supplier, so the check is a call or a form with them, made early enough that funded work can still be scheduled before the scheme closes.

In England, Warm Homes: Local Grant is the door that stays open

Warm Homes: Local Grant runs from April 2025 to March 2028, through councils, in England only. The base test is household income of £36,000 a year or less; gov.uk’s own word is “usually”, because a household above that figure can still qualify through certain benefits, an eligible postcode area, or an after-housing-costs measure that depends on household composition. The home needs an EPC rating of D to G and must be privately owned or privately rented. For an eligible owner-occupier the upgrades are fully funded: the council organises and pays for the work, and gov.uk states plainly that you will not need to pay for it.

The route in is the eligibility checker on gov.uk, and delivery is your council’s: it organises and pays for the improvement work it agrees with you. Councils deliver on their own schedules within the national window, so the same eligibility can move faster in one borough than another; that is the delivery model, not a defect in your application.

Scotland has its own grant and loan; Wales adds two routes to the Boiler Upgrade Scheme

Scotland sits outside the Boiler Upgrade Scheme and runs Home Energy Scotland’s grant and loan instead: a grant of up to £7,500 toward a heat pump, up to £9,000 for rural and island homes, with an optional interest-free loan of a further £7,500 on top. The loan carries an administration fee of 1.5% of its value, capped at £150. You do not need to be receiving benefits to qualify, but the grant does test tenure: you own the home, live in it as your only or main residence, and it is an existing property.

Wales is inside the Boiler Upgrade Scheme, so the £7,500 and £9,000 rates above apply there, and it adds two routes of its own. Nest, the Welsh Government’s fully funded scheme, gates on three tests together: a means-tested benefit or a low income, owner or private-renter tenure, and a poor energy rating for the home; the income thresholds are published per household composition and measured after housing costs, so no single figure honestly summarises them (the current gates are on gov.wales, where nest.gov.wales redirects). Above that line sits Green Homes Wales, run by the Development Bank of Wales: interest-free loans of £1,000 to £25,000 over up to ten years, with grant funding alongside, credit-assessed. Northern Ireland’s schemes are not covered in this guide; the VAT relief is UK-wide and applies there.

What a closing scheme changes in your arithmetic

A grant changes the price side of a replacement decision, and an expiring grant moves the cheapest year to make it. The annual cost of a heating system is its installed price divided by the years it runs; £9,000 off the price, inside the window and not after, can pull the replacement of a component already near the end of its life forward by a year or two. What it does not do is make a young system old: a boiler with eight good years left is not a deadline decision, because the standard £7,500 remains after the window closes, and eight years of remaining service are worth more than the reliefs that expire.

The windows bite in two places. In an oil- or LPG-heated house, the heat pump grant steps down from £9,000 to £7,500 and the VAT moves five points, a day apart at the end of March 2027, so an ageing heating system’s replacement year is worth re-running now. On insulation work you already intended, only the VAT moves. Ordinary maintenance is untouched by all of it: none of these schemes prices a roof covering, a gutter run or a window frame, so that arithmetic runs unrelieved. Keeping each system’s date against the scheme calendar is what a maintenance plan is for; in appkeep, the year your heating system needs pricing sits in the plan next to what that year’s price looks like, so a closing window shows up against your boiler’s own date rather than as a headline you happened to catch in time.

The decision inside the window is still repair versus replace, run the usual way: the grant belongs in the replacement price before the division, not as a reason on its own.

Worked example: Ruth in Powys

Ruth heats a stone cottage in Powys with an oil boiler; there is no mains gas in the lane. The boiler is nineteen years old, and her heating guide’s arithmetic already put its replacement in the next two years. Her installer’s quote for an air-to-water heat pump is £13,400 installed; that is her quote for her house, not a market rate.

Inside the window, the sums are short. Her house is oil-heated with no mains gas connection, so the application carries the £9,000 rate: £13,400 minus £9,000 is £4,400, and the VAT on the installation is zero, already reflected in the quote.

If the same work runs after the window, both reliefs move at once. The grant returns to £7,500, and from 1 April 2027 the installation carries 5% VAT, about £670 on her quote: £14,070 minus £7,500 is £6,570. Same house, same system, £2,170 more, for a boiler that was due anyway.

Her sequence is the one above: get an installer booked, apply as the booked date approaches rather than as soon as it goes in the diary, and have the system commissioned before 31 March 2027 rather than on it. The move she owns is instructing an installer while the diary still has room, for a replacement that was already a next-two-years decision.

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Related guides

• How much house maintenance costs per year in the UK: the arithmetic the grants plug into, for the whole house.
• Repair, replace, or wait: the division a grant belongs inside, not beside.
• How long heating systems last: the clock that decides whether a scheme window is your window.
• How to set a mandate: turning a grant-adjusted price into a ceiling before the work starts.

Glossary terms used in this guide

• Glossary: Annual cost method: price divided by the years it buys, the calculation every grant changes.
• Glossary: Component: the unit whose age, not the scheme calendar, starts the decision.
• Glossary: Quote: the document the VAT rate and the grant deduction should both be visible on.