Who is exempt from the Climate Change Levy?

Excluded: domestic and charity non-business use

The levy does not apply to domestic use. GOV.UK's examples include armed forces residential accommodation, children's homes, hospices, religious houses, caravans, houseboats, self-catering holiday accommodation and supplies to community heating schemes. Charities are excluded for non-business activities; business activities such as selling donated goods or hiring a village hall are taxable unless the small-amount limits apply (GOV.UK: Exemptions from Climate Change Levy).

Small amounts

Supply	Treated as domestic if below
Electricity	1,000 kWh per month
Piped gas	4,397 kWh per month
LPG in cylinders	each cylinder under 50 kg
LPG in bulk	tank under 2 tonnes

Mixed premises: the 60% rule

If domestic or charitable non-business use is at least 60% of the total, the whole supply is excluded. Below 60%, the levy applies to the non-qualifying part.

Example: a church centre uses 2,500 kWh a month of electricity, 55% for worship and community use that is non-business. Below 60%, so the 45% business part is taxable: 2,500 × 45% = 1,125 kWh × £0.00801 = £9.01 a month. At 65% qualifying, the whole bill would be levy-free. See church and community building energy.

Specialist exemptions

The main-rate levy is also not charged on some energy that is exported, not used as fuel, supplied to electricity producers and CHP stations, used in metallurgical and mineralogical processes, or used in specific transport such as electrifying railway lines. These rarely affect shops or offices. Separately, Climate Change Agreements reduce the rate for eligible industrial operators: climate change agreements.

How to claim

• Charities: give your supplier a VAT certificate covering the non-business use.
• Mixed-use customers: supply a certificate stating the qualifying percentage.
• Landlords and other intermediaries: submit a CCL declaration with the end user's name and address, confirmation of qualifying use, the eligible percentage and a signed declaration.

Relief is not usually applied automatically in mixed-use cases. Ask your supplier what paperwork it needs; see the reduced-rate declaration for the VAT equivalent.

Common situations

• Landlord supplying tenants: the levy follows the end user's use; the declaration route above is how that is evidenced.
• Home-based business: if the supply is domestic and under the monthly limits, the levy is not charged.
• Care homes and hospices: hospices and children's homes are among GOV.UK's examples of domestic use, and residential care may also qualify; see care homes and reduced VAT.

Worked check: is a small user under the limit?

A hair salon uses 9,600 kWh of electricity a year. That is 9,600 ÷ 12 = 800 kWh a month, below the 1,000 kWh monthly limit, so it should see no levy on its bill. A café using 18,000 kWh a year averages 1,500 kWh a month, so the levy applies to all of it: 18,000 × £0.00801 = £144.18 a year at the 2026-27 rate. If your bill shows the levy but your average is clearly under the limit, ask your supplier to check how it has classified the supply.

Next steps

1. Check your monthly kWh against the small-amount limits.
2. Work out your qualifying percentage if mixed use.
3. Send your supplier the certificate, then check the next bill. More on how CCL affects your bill.