31 March 2027: four heat pump deadlines on one date

What ends on 31 March 2027

Four separate policies all expire on the same date. Three are set by government and one by MCS, each introduced at a different time for a different reason. None was designed to align with the others. The convergence is a coincidence of the calendar, but the consequences are not.

1. Zero-rate VAT on heat pump, solar and battery installations reverts to 5%. Since 1 May 2023, the installation of energy-saving materials in residential properties in Great Britain has been zero-rated for VAT. That includes air source and ground source heat pumps, solar panels, battery storage and several other technologies [1]. From 1 April 2027, the rate reverts to the previous reduced rate of 5%. On a £12,000 heat pump installation, that adds roughly £600 to the net cost.

2. The Boiler Upgrade Scheme uplift for off-gas homes drops from £9,000 to £7,500. Eligible properties off the gas grid, typically heated by oil or LPG, can claim £9,000 toward an air source heat pump through the Boiler Upgrade Scheme [2]. The standard grant for all properties remains £7,500. The uplift ends on 31 March 2027, after which off-gas properties revert to the standard rate. For an off-grid household, the grant shrinks by £1,500 on the same day the VAT on the installation goes back up.

3. OZEV chargepoint grants close. The Office for Zero Emission Vehicles runs grants for domestic and workplace EV chargepoints. The Workplace Charging Scheme, which pays up to £500 per socket for eligible businesses, closes on 31 March 2027 [3]. This matters less for heat pumps than for solar and EV charging, but it adds a third policy expiring on the same date, and many installation firms work across all these technologies.

4. The MCS transition deadline. MCS has been redeveloping its installer certification scheme. All MCS-certified installers must have transitioned to the redeveloped scheme by 31 March 2027 [4]. MCS has not said what happens to an installer who has not moved over by then. The Boiler Upgrade Scheme uses MCS-certified installers, so a gap in certification would stop that installer's BUS work. The redeveloped scheme requires an MCS-approved financial protection product for each domestic installation, which takes time to set up.

Why the convergence matters

Any one of these would be manageable on its own. The problem is that they land together, and they interact.

Consider a homeowner in an oil-heated property planning a heat pump for spring 2027. In March, they get £9,000 toward the cost, pay no VAT on the installation, and their installer is MCS-certified under the existing scheme. In April, the grant drops to £7,500, 5% VAT applies to the installation, and their installer may not yet have completed the MCS transition. The total swing could be £2,000 or more on a single installation, before any change to the price of the equipment.

For installers, the MCS transition is the binding constraint. An installer who leaves it too late risks a gap in certification, and BUS uses MCS-certified installers. The redeveloped scheme requires MCS-approved financial protection for domestic installations. That is not something to leave until the last week of March.

The BUS evaluation published by DESNZ on 24 September 2026 found that 29% of installer companies had experienced cash flow problems from the delay between completing an installation and receiving the grant payment [5]. The same evaluation estimated that 74% of BUS-funded installations, about 36,500 of 49,100, would not have gone ahead without the grant. When the grant is the deciding factor for three quarters of installations, a simultaneous cut in the grant and increase in VAT is a real change in the market, not a technical adjustment.

The electricity side: a fifth expiry

A fifth policy ending on 31 March 2027 gets less attention but compounds the effect. The temporary 0% VAT on domestic electricity in Great Britain applies from 1 October 2026 to 31 March 2027; Northern Ireland stays at 5% [6]. If it is not extended, electricity prices effectively rise by 5% from 1 April 2027.

This matters for running costs. The October 2026 Ofgem price cap sets electricity at 26.32p/kWh and gas at 7.97p/kWh, national average Direct Debit rates [7]. With 0% VAT on electricity, the electricity-to-gas ratio narrows to about 3.3:1. A heat pump needs a seasonal coefficient of performance (SCOP) of about 3.0 to break even on running costs against a 90% efficient gas boiler at those rates: multiply the electricity price by the boiler efficiency and divide by the gas price, and you get 2.97.

If the VAT on electricity reverts to 5%, the spark gap widens again: at the October cap rates plus 5% VAT on electricity, about 27.6p/kWh, the break-even SCOP rises to about 3.1. The running-cost economics that improved in October could partially unwind in April.

What could change before March

The Autumn Budget is scheduled for 28 October 2026. The government could extend the 0% VAT rate on energy-saving material installations, on domestic electricity, or both. Neither extension has been trailed. The absence of a trail is not evidence of a decision either way; it is simply that both policies were time-limited by legislation, and extending either requires new legislation or a Budget announcement.

The government's Warm Homes Plan (DESNZ, March 2026) sets out Boiler Upgrade Scheme funding each year to 2029/30. The grant level is kept under review, so check GOV.UK for the current amount. Only the £9,000 uplift for off-gas homes is time-limited to 31 March 2027.

The MCS transition deadline is set by MCS, not by HM Treasury, so it is not a Budget measure. MCS gives it as 31 March 2027.

What this means in practice

For homeowners. If you are planning a heat pump and you heat with oil or LPG, the window between now and 31 March 2027 is materially different from what follows. The grant is £1,500 higher, the installation carries no VAT, and the electricity that runs the heat pump is also VAT-free. None of these factors is likely to be spelled out in a quote you receive today, because most quotes focus on the grant, not on the VAT treatment of the installation or the electricity. Ask your installer to show the full picture.

For installers. The MCS transition is the deadline you control. The grant and VAT rates are set by government; the certification is your responsibility. If you have not started the transition to the redeveloped MCS scheme, the time to start is now. The new financial protection requirement involves setup time with a third-party provider. An installer without MCS certification cannot install under the Boiler Upgrade Scheme, which the BUS evaluation found was the deciding factor for about three quarters of funded installations [5].

For both. The Budget on 28 October is the next moment something could change. Until then, 31 March 2027 is the working assumption, and the four deadlines are real.

Sources and limitations

1. VAT on energy-saving materials: HMRC VAT Notice 708/6, GOV.UK. Zero rate applies from 1 May 2023 to 31 March 2027 in Great Britain. Northern Ireland has separate provisions under the Windsor Framework. Source: GOV.UK VAT Notice 708/6.

2. BUS £9,000 uplift: GOV.UK, Boiler Upgrade Scheme: what you can get (updated 1 October 2026; read 11 October 2026). An extra £1,500 until March 2027 for a home heated by oil or LPG with no mains gas connection. Standard grant remains £7,500. Source: GOV.UK.

3. OZEV chargepoint grants: OZEV, Workplace Charging Scheme: guidance for installers, GOV.UK (updated 1 April 2026; read 11 October 2026). The scheme "has been extended for a final year until 31 March 2027". Up to £500 per socket for installations completed on or after 1 April 2026 (up to £350 before), capped at 75% of costs and 40 sockets. Source: GOV.UK.

4. MCS transition deadline: MCS, "DESNZ recognises strength of consumer protections offered by redeveloped MCS as installer transition gathers pace" (news, 18 June 2026; read 11 October 2026): "The transition phase will last until 31 March 2027; the deadline by which all MCS certified installers will need to be operating under the redeveloped Scheme." MCS repeated the date on 23 September 2026. Domestic installations under the redeveloped scheme need an MCS-approved financial protection product. Source: MCS.

5. BUS evaluation: DESNZ, Evaluation of the Boiler Upgrade Scheme, 2026 (final report, published 24 September 2026). Covers the original phase, 2022 to 2025, in England and Wales. 74% of BUS-funded installations estimated as additional (36,508 of 49,136). 29% of installer companies reported cash flow problems from the payment delay. The evaluation covers the period before the £9,000 uplift was introduced. Source: GOV.UK.

6. 0% VAT on domestic electricity: HMRC, Revenue and Customs Brief 10 (2026), published 8 September 2026 (read 9 October 2026). Zero rate applies to qualifying supplies from 1 October 2026 to 31 March 2027 in Great Britain (England, Scotland and Wales). Northern Ireland stays at the reduced rate of 5%. Legal basis: The Value Added Tax (Supplies of Domestic Electricity) Order 2026, SI 2026/987. Source: GOV.UK.

7. October 2026 Ofgem price cap: Ofgem energy price cap, October to December 2026. Electricity 26.32p/kWh, gas 7.97p/kWh (national average Direct Debit). Break-even SCOP calculation: (26.32 x 0.90) / 7.97 = 2.97. Source: Ofgem.

8. Boiler Upgrade Scheme funding: DESNZ, Warm Homes Plan (published 21 January 2026, updated 18 March 2026; read 9 October 2026). £2.7bn for the scheme from 2025/26 to 2029/30; grant level and eligibility kept under review.