Niamh Smyth (Cavan-Monaghan, Fianna Fail)
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205. To ask the Minister for Finance to examine the case for reviewing the 0% VAT treatment of solar power ancillary equipment (details supplied), to ensure that homeowners who face financial barriers to installing a battery upfront are not unfairly penalised for adding one later; and if he will make a statement on the matter. [4542/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law is required to comply. In general, the Directive provides that all goods and services are liable to VAT at the standard rate unless they are exempt from VAT or fall within Annex III of the Directive, in which case lower VAT rates may apply subject to certain rules.

In accordance with the Directive and Irish legislation, the supply and installation of solar panels on or adjacent to immovable property, being private dwellings, is subject to the zero rate of VAT. For the zero rate to apply, both the supply of the solar panels and their installation must be the responsibility of the same business in the same supply (i.e. a supply and install contract).

The zero rate applies to ancillary equipment, such as a battery, only where the ancillary equipment is supplied and installed with the solar panels as part of the same supply and install contract.

Where ancillary equipment, such as a battery, is supplied separately to the supply and installation of the solar panels, those goods are subject to VAT at the standard rate, which is currently 23%. There is no discretion under the Directive for Ireland to apply a reduced rate of VAT to such supplies.