VAT adjustment for installation of fossil heating boilers

From July 1, 2025, the VAT regulation for fossil heating boilers will change. Until then, you could still have a gas or oil boiler installed at the reduced rate of 6% when renovating a private home older than ten years, or during demolition and reconstruction. From the summer of 2025, this advantage disappears and the standard rate of 21% applies again.

For maintenance and repairs of existing fossil boilers, the reduced rate is retained, provided it concerns a home older than ten years or a demolition and reconstruction project. Buildings intended for education and social housing also continue to be entitled to the 6% rate. The change therefore only applies to the installation of new fossil heating boilers.

Can you still heat with fossil fuels? That is still possible for now, but with limitations. For example, new oil boilers may no longer be installed in streets where a natural gas connection is available. For new construction projects and major energy renovations, oil was already excluded. From 2026, new homes may also no longer connect to natural gas. The policy is therefore clearly focusing on sustainable alternatives such as heat pumps.

The federal government is implementing this adjustment to reduce greenhouse gas emissions and accelerate the energy transition. After all, Europe wants to be climate neutral by 2050. By making the installation of fossil boilers more expensive, they want to make the switch to sustainable heating systems more attractive. The reduced VAT rate of 6% does continue to apply to the installation of heat pumps during renovation.

In short: anyone still planning to have a new fossil heating boiler installed should bear in mind that this will become significantly more expensive from July 1, 2025. It is therefore the ideal time to consider switching to a future-oriented, sustainable solution.