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Make your house a home - How your renovations can be tax efficient

Date: 17 April 2025

4 minute read

What does your dream space look like? Maybe you envision a state-of-the-art kitchen, a luxurious spa bathroom, or even some accessibility adaptations. Whatever your vision, we have a few savvy tips to ensure you make your renovations as tax efficient as possible.

Energy-efficient upgrades

Some call it the Green Revolution: the world turning to eco-friendlier ways to live. The UK is no different, as various renovation schemes have been introduced that will not only be great for the environment but also for your wallet!

  • Energy Company Obligation
    Grants for energy-saving insulation, double glazing, and efficient boilers. This scheme helps reduce carbon emissions and energy bills, making it a smart financial move for those looking to enhance their home.
  • Boiler Upgrade Scheme
    Grants up to £7,500 for low-carbon heating systems like heat pumps and biomass boilers. This scheme supports the transition to renewable heating systems, offering significant financial incentives for those investing in long-term energy efficiency. Leverage these schemes, and you can make substantial home improvements while enjoying reduced energy costs and government grants – it’s a win-win for both your home and the planet.  

Leverage these schemes, and you can make substantial home improvements while enjoying reduced energy costs and government grants – it’s a win-win for both your home and the planet.

Home office renovations

In 2019, only 4.7% of the UK’s population worked from home. By 2023, the number reached 44%.1 Yet it can still be tricky to separate work from home – which is where a well-designed home office comes in. Use part of your home exclusively for business, and you may be able to claim a portion to renovation:

  • Claim capital allowance on office furniture, insulation, electrical wiring, and plumbing to name a few. These allowances can reduce your taxable income, making your renovation more cost-effective.
  • Claim a portion of your home office running costs – such as heating, lighting, and metered water – based on the proportion of your home used for business. You can also claim dedicated services like broadband and electricity in full.
  • If your business is VAT registered, you can claim back VAT on business-related expenses, including office furniture, equipment, and energy-efficient upgrades. By strategically planning your home office renovations with available tax reliefs, you can enhance your work environment while also making your investment more financially savvy.

Accessibility modifications

For the older generation, the UK government offers tax relief for home modifications that improve accessibility for disabled individuals, including:

Ramps and Stairlifts

Installing ramps and stairlifts can make your home more accessible. These modifications are eligible for VAT relief.

Widened Doorways

Widening doorways to accommodate wheelchairs or walkers can also qualify for VAT relief.

Accessible Bathrooms

Adapting bathrooms with walk-in showers, grab bars, and lower sinks can make them more accessible and are eligible for VAT relief.

Classy Home Renovation Ideas:

For the wine enthusiasts…

“Penicillin cures, but wine makes people happy,” Alexander Fleming once said. We are inclined to agree – and for grape lovers a custom wine cellar could be the perfect addition to your home. To make this dream even sweeter, consider using energy-efficient cooling systems. Not only will they keep your wine at the ideal temperature, but they may also be eligible for tax deductions under the Boiler Upgrade Scheme. This scheme can also apply to kitchens, greenhouses, and outdoor spaces where temperature control is key.

An office full of zen…

Work can be stressful, but your home office doesn’t have to be. Transform your workspace into a zen-inspired haven where tranquillity meets productivity. Let natural light flood in through floor-to-ceiling windows. If these windows are energy-efficient, you can claim tax deductions under the Energy Company

Obligation scheme. Or even add a meditation corner with soundproofing, ambient lighting, and a state-of-the-art sound system. These features can be claimed as capital allowances if they enhance home office functionality.

All at the touch of a button…

Accessibility isn’t just about ramps and widened doorways (though these often qualify for VAT relief). Home automation systems, such as automated curtains, smart lighting, voice-controlled systems, and automated doors, can be claimed as capital allowances if used for business purposes. These upgrades not only make your home more accessible but also add a layer of luxury and convenience.

Want to know more?

If you have any questions, please don’t hesitate to contact your Quilter Cheviot financial planner. They are here to help you navigate the various schemes and allowances available, ensuring you make the most of your investments while creating the home of your dreams.

1https://www.forbes.com/uk/advisor/business/remote-work-statistics/

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