How to Find Your VAT on Gas and Electricity Bills Understanding the VAT (Value Added Tax) on your energy bill is vital for managing costs and ensuring you’re not being overcharged. Whether you’re a small business or a charity, knowing how VAT applies to your gas and electricity can help you claim exemptions and check your bills for errors!!
If you would like to read more information or learn more about the pricing of business energy, you can do so here .
How to Find Your VAT on Gas and Electricity Bills – Useful links from our article:
Step-By-Step Guide to Finding Your VAT Rates
Review VAT Exemptions and Reductions
Check for Common Errors
Example Breakdown of an Energy Bill
Step-By-Step Guide to Finding Your VAT Rates
Locate your bill
Grab your most recent bill, whether it’s a PDF or printed copy. Having it in front of you makes it easier to follow along.
Identify the breakdown of charges
Your energy bill should show sections such as:
Electricity Usage or Gas Usage Unit Rates (pence per kWh)Standing Charges Subtotal Before VAT
Find the VAT section
Scroll or flip toward the bottom of your bill. Look for a line labelled VAT , Value Added Tax , or similar. This line will show the VAT percentage and the amount charged.
Understand the VAT Rate (2025 Rates)
🏠 5% Reduced Rate: Applies to most domestic energy and to microbusinesses meeting Ofgem’s criteria.
🏢 20% Standard Rate – Applies to most businesses.
If your business operates from a mixed-use property or qualifies for partial VAT relief (e.g., charities), your bill may be split proportionally.
Calculate the VAT amount 🧮
To double-check the VAT:
Reduced rate (5%) : Multiply the subtotal by 0.05 Standard rate (20%) : Multiply the subtotal by 0.20
Compare your result to the VAT shown on your bill to ensure accuracy.
Compare this calculated VAT amount with what’s listed on your bill to ensure accuracy.
Review VAT Exemptions and Reductions Some organisations qualify for reduced or zero VAT, including:
Registered charities
Non-profits
Microbusinesses using less than 33 kWh/day of electricity or 145 kWh/day of gas
✅ Action tip : Submit a VAT Declaration Certificate HMRC Form VAT1615A
Check for Common Errors On Your VAT on Gas and Electricity Bills Mistakes happen! Double-check the following:
Wrong VAT rate applied
Misclassified business type (e.g. listed as commercial instead of charity)
Incorrect usage details or meter readings
🗣️ Contact your supplier immediately if you spot errors. You may be entitled to a refund or correction.
Example Breakdown of an Energy Bill
Charge Type Amount
Electricity Usage (1,000 kWh @ £0.15)
£150.00
Standing Charge (30 days @ £0.50/day)
£15.00
Subtotal Before VAT £165.00
VAT @ 5% £8.25
Total Amount Due £173.25
Read more on the HMRC website here .
In this example, the VAT section clearly shows the rate and the calculated VAT amount.
Here is a Handy Youtube Guide About How to Find Your VAT on Gas and Electricity Bills
How to Find Your VAT on Gas and Electricity Bills – Check out our other useful links about Business Energy Hi, I’m Ally Cox , a senior copywriter and blogger at CompareYourBusinessCosts.co.uk, the UK’s trusted platform for comparing business services.over a decade of experience in the B2B sector, I specialise in simplifying complex topics like leased lines, VoIP, business energy, HR and payroll solutions, accounting software, and EPOS systems .HR, copywriting, and business operations- from clocking-in systems to card machines and office technology .informed, confident decisions when choosing products and services that improve efficiency and save money.
