Martin Lewis’s MSE reveals households could be owed ‘boiler tax’ refund worth up to £120 – check if you’re one of them
MARTIN Lewis’s MoneySavingExpert (MSE) has revealed how thousands of households could be owed a tax refund worth up to £120 if they bought a new boiler this year.
Many of the UK’s top manufacturers hiked the prices of their boilers earlier this year in anticipation of the Conservative Government’s Clean Heat Market Mechanism (CHMM).
The scheme, which was supposed to come into effect in April, would have seen boiler firms fined if they did not sell a certain number of heat pumps each year compared to their boiler sales.
This was introduced to help meet environmental targets.
At the time, the Tories said they would push the proposal back to next March, but this timeline may change now that Labour is in charge.
The Sun has asked the government if this date intends to change.
However, in anticipation of being fined, major manufacturers raised the prices of their gas boilers by £120.
It is suspected that thousands of customers who purchased at the start of the year would have had this so-called boiler tax added to their bills.
If you bought a new Baxi, Ideal, Worcester Bosch or Vaillant/Glow Worm boiler between January 1 2024 and March 21 2024, you may have had up to £120 (excluding VAT) added to the cost, according to a report in MoneySavingExpert.
You are entitled to a refund but the amount you can get varies from supplier to supplier.
This is how much MSE says you are entitled to:
Baxi boiler: £120 but you must have bought it between January 1 – March 18 2024
Ideal boiler: £110 but you must have bought it between January 1 -March 15 2024
Glow Worm boiler: £95 but must have been bought between January 1 – 19 March 2024
Worcester Bosch: £120 but must have been bought between January 1 – 15 March 2024.
What is a heat pump?
Heat pumps are powered by electricity and work by transferring heat from the ground or air outside into a building.
They are more energy-efficient compared to traditional gas boilers, which are set to be banned from 2035, typically offering three to four units or heat for each unit of electricity needed to run them, according to Which?
There are two types of heat pumps – air source and ground source.
Under the Government’s Boiler Upgrade Scheme, households can get grants worth up to £7,500 towards the cost of either type.
Heat pumps can be great for slashing your energy bills and they tend to have a longer life span than gas boilers.
But there are some drawbacks.
The up-front cost of installing them can set you back thousands of pounds, even with help through the Boiler Upgrade Scheme.
The average cost can range from £5,000 to £8,000 depending on the size of the home.
Air-source heat pumps can run less efficiently in the winter too, when the machine has to work harder to produce warm water.
Plus, a well-insulated home is essential with an air-source heat pump, so you’ll have to factor in the added cost of insulation.
Heat pumps can be quite noisy as well, although this shouldn’t be too much of an issue if you install in the right place.
How can I claim the money back?
It has been estimated that over 400,000 new boilers were sold over this time period, so it is worth checking to see if you are entitled to the rebate.
But it is important to note that not everyone would have had the levy added to the cost of their new boiler.
This is because boiler manufacturers don’t typically sell directly to the customer, but instead to outside parties such as plumbers.
So it may have been the case that they were taxed and not you.
It’s been advised that you check the invoice for your new boiler and see whether it makes any reference to the tax levy.
Even if it does not mention it the charge may have still been made so it is worth calling up your installer and asking them.
According to MSE, boiler manufacturers involved have said they have refunded their customers.
Meanwhile, Wolsely and City Plumbing, two of the biggest UK distributors of boilers, said they “have received the manufacturers’ refund and have passed this on to their customers”.
It is important to remember that you are only entitled to a refund if the charge was added to the cost of your new boiler during the specific time period.
Are you entitled to a free boiler?
Low-income households may qualify for major discounts on installing boilers or insulating their homes.
For example, the Energy Company Obligation, set up by the Government, lets households on certain benefits apply to have energy-saving measures installed in their homes.
It might mean cavity wall or loft insulation, or maybe even a new boiler fitted, sometimes for free.
To qualify you usually need to be on one of the following benefits
- Pension Guarantee Credit
- Income-related Employment and Support Allowance (ESA)
- Income-based Jobseeker’s Allowance (JSA)
- Income Support
- Tax Credits (Child Tax Credits and Working Tax Credits)
- Universal Credit
- Housing Benefit
- Pension Credit Saving Credit
Households’ needs are assessed on a case-by-case basis, so there’s no guarantee you’ll get help, but it is worth looking into.
Also, suppliers such as Octopus Energy regularly hand out other freebies such as electric blankets to help customers during the winter months.
The energy firm, which serves six million customers, is also loaning thousands of thermal imaging cameras to customers so that they can find spots in their homes where heat is escaping.
Once those draughts are identified, people can then look into ways to get them fixed and thus reduce their energy usage.
Get help with your energy bills
THERE’S a number of different ways to get help paying your energy bills if you’re struggling to get by.
If you fall into debt, you can always approach your supplier to see if they can put you on a repayment plan before putting you on a prepayment meter.
This involves paying off what you owe in instalments over a set period.
If your supplier offers you a repayment plan you don’t think you can afford, speak to them again to see if you can negotiate a better deal.
Several energy firms have grant schemes available to customers struggling to cover their bills. These include:
You Pay We Pay: British Gas has just launched its ‘You Pay: We Pay’ initiative 100% matches energy payments made by customers who are struggling and most in need of help.
British Gas Energy Trust: The British Gas Energy Trust is an independent charity solely funded by British Gas and, as well as directly helping all consumers with grants, it also works with and provides funding to other money and energy advice projects.
Octo Assist’: A fund by Octopus Energy for customers who are experiencing financial hardship which stands at £30m. It has helped over 70,000 customers so far and is still open.
Octopus has also already absorbed tens of millions of pounds on behalf of customers by keeping standing charges below the price cap,.
To apply for assistance you can visit the company website.
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