The Boiler Upgrade Scheme: £7,500 Off a Heat Pump, Explained Properly.
England and Wales will pay £7,500 of your air source heat pump, deducted straight off the quote by your MCS-certified installer. Until March 2027 it is £9,000 for oil and LPG heated homes with no mains gas. Stack 0% VAT on top and most households end up £500 to £6,500 out of pocket on a £8,000 to £14,000 installation. Meanwhile the Ofgem cap gas rate is up 39% since spring 2026. Here is the whole picture, including what Scotland and Northern Ireland get instead.
In 60 seconds
- •£7,500 off an air-to-water or ground-source heat pump in England and Wales. Air-to-air units get £2,500 (added in 2026); biomass boilers £5,000.
- •£9,000 until March 2027 for homes heated by oil or LPG with no mains gas connection (an extra £1,500). Air-to-water and ground source only, not air-to-air or biomass.
- •Your installer claims it for you. The installer must be MCS-certified and applies on your behalf; the grant comes straight off the quote. You never front the £7,500.
- •No EPC hoop any more. The EPC-certificate precondition was removed on 28 April 2026.
- •Who qualifies: owner-occupiers, small landlords and second homes; most new-builds do not.
- •Scotland and Northern Ireland differ. Scotland uses the Home Energy Scotland grant and loan instead; Northern Ireland currently has no equivalent. 0% VAT until 31 March 2027 applies UK-wide.
- •The result: £500 to £6,500 out of pocket for most grant-backed installs on a typical £8,000 to £14,000 job. Octopus says its median quote was £4,064 after the grant (June to September 2026). Indicative, June 2026.
How the grant actually works
The Boiler Upgrade Scheme is unusually painless for a government scheme: the installer does the paperwork and you see the discount on the quote. The flow looks like this.
Find an MCS-certified installer
The scheme requires one: that is a factual rule, not marketing. Only an MCS-certified installer can apply for the grant. Get two or three quotes; all of them can claim the same grant, so compare on the post-grant figure.
Heat-loss survey
Part of every MCS installation: the installer calculates your home's heat loss room by room, which sets the heat pump output, radiator sizing and cylinder size. This survey, not bedroom count, is what sizes the system.
Quote shows the grant deducted
A proper quote shows the installed price, the £7,500 (or £9,000) deduction, and your out-of-pocket figure, with 0% VAT already applied. If a quote does not show the grant line, ask why.
Installer applies, you pay the difference
The installer applies to the scheme on your behalf, fits the system, commissions it and gives you the MCS certificate. You pay the post-grant price. The grant money flows between the installer and the scheme; it never needs to pass through you.
Any gas work in the job, removing the old boiler and capping the supply, must be done by a Gas Safe registered engineer. Scheme details accurate as at June 2026; sources at the bottom of this page.
What you actually pay
Indicative UK pricing as at June 2026, with 0% VAT already reflected. Always treat these as ranges, not quotes.
Before the grant
After the £7,500 grant
The honest framing
Nobody is forcing the switch: there is no gas ban and repairs to your existing boiler remain perfectly sensible. The decision point is end-of-life. Boilers do not last forever, and when yours dies you will be buying something either way. At that moment, a heat pump with £7,500 off and 0% VAT is competing against a new boiler at full price plus a gas rate that is up 39% since spring 2026. That is why the rational default has shifted.
- →Boiler under 5 years old: relax, but know your plan for when it goes.
- →Boiler 5-10 years old: get quotes now so a failure does not force a rushed like-for-like boiler swap.
- →Boiler over 10 years old: it could go any winter. Have an installer and a model picked so the switch is a phone call, not a panic.
Gas boiler vs heat pump: the running-cost maths
The comparison that matters is pence per kilowatt-hour of heat, not pence per kilowatt-hour of fuel. Electricity costs roughly 3.3 times what gas costs per unit on the cap (26.32p against 7.97p per kWh from 1 October 2026), but a heat pump produces 3.8 to 4.5 units of heat per unit of electricity (its SCOP), while a modern boiler gets about 0.9 units of heat per unit of gas. Divide it through and the heat pump now comes out below the boiler: in spring 2026 the two landed in the same band, and the July and October gas rises have tipped it toward the heat pump.
| System | Cost per kWh of heat (est.) | Annual cost, ~10,000 kWh of heat (est.) |
|---|---|---|
| Air source heat pump (SCOP 3.8-4.5) | 5.8 - 6.9p | £585 - £690/yr |
| Gas boiler (90% efficient), Apr-Jun 2026 cap | ~6.4p | ~£640/yr + standing charge |
| Gas boiler (90% efficient), from 1 October 2026 cap | ~8.9p | ~£890/yr + standing charge |
| Electric storage heaters (flat rate) | ~26p | ~£2,630/yr |
Estimates at Ofgem price cap direct-debit averages: electricity 26.32p/kWh and gas 7.97p/kWh from 1 October 2026; gas was 5.74p/kWh in Apr-Jun 2026. The cap changes quarterly. Heat-pump time-of-use tariffs can cut the heat pump figure further, but tariffs change, so compare current offers. Actual costs depend on your tariff, home and usage.
Scotland and Northern Ireland: what applies instead
The BUS is funded for England and Wales only. The rest of the UK splits two ways.
Home Energy Scotland grant and loan
- Grant of up to £7,500 toward a heat pump, rising to £9,000 with the rural and island uplift.
- Plus an optional interest-free loan of up to £7,500 more, repayable over up to 12 years.
- Key difference from the BUS: you apply yourself, before installation, through Home Energy Scotland. Get the offer confirmed, then book the install.
No equivalent scheme (the honest answer)
- There is currently no Boiler Upgrade Scheme equivalent in Northern Ireland; budget the full installed price.
- 0% VAT until 31 March 2027 still applies and is already reflected in quotes, typically worth £1,000 to £3,000.
- NI is oil-dominated rather than gas-dominated, so the running-cost case is against oil deliveries and price swings. Limited efficiency support is listed on nidirect.gov.uk.
The dates that matter
Checked against GOV.UK and HMRC on 9 October 2026, and Ofgem cap announcements to October 2026.
EPC precondition removed.
You no longer need a valid EPC with no outstanding insulation recommendations to claim the BUS grant. One of the biggest historical friction points, gone.
Ofgem cap gas rate rose 27%.
The gas unit rate steps from 5.74p to 7.33p/kWh (typical bills up around 13%). Electricity rises far less, from 24.67p to 26.11p. The running-cost comparison shifts further toward heat pumps.
Oil and LPG top-up ends.
Until March 2027, homes heated by oil or LPG with no mains gas connection get an extra £1,500 (£9,000 in total), per GOV.UK.
Ofgem cap gas rate rose again.
The gas unit rate steps from 7.33p to 7.97p/kWh, 39% above its April-June level. Electricity moves from 26.11p to 26.32p.
0% VAT window ends.
VAT on residential heat pump installations is 0% until 31 March 2027, then rises to 5%. The relief is applied automatically by the installer and is typically worth £1,000 to £3,000.
What to do now
If your boiler is 6 years old or more, start planning. A planned switch always beats an emergency one, and the strongest support window (£9,000 oil/LPG uplift, 0% VAT) has dates attached.
Run the numbers
Compare keeping your gas boiler against switching now, with the grant in the capital maths and the October 2026 cap rates in the running costs.
Open the calculator →Compare brands
Eight brands have a verified UK presence, from value to premium German engineering. Every air-to-water unit qualifies for the grant via an MCS installer.
Compare 13 brands →Get quotes before you need them
Quotes should show the price before the grant, the deduction, and your out-of-pocket figure. Comparing two or three on that basis is the whole game. It takes 2 minutes to request.
Get free quotes →Frequently asked questions
What is the Boiler Upgrade Scheme?
The Boiler Upgrade Scheme (BUS) is the government grant for replacing fossil-fuel heating with low-carbon heating in England and Wales. It pays £7,500 toward an air-to-water or ground-source heat pump, £2,500 toward an air-to-air heat pump (added in 2026), and £5,000 toward a biomass boiler. Until March 2027, homes heated by oil or LPG with no mains gas connection get an extra £1,500 toward an air source or ground source heat pump, so £9,000 in total. Details checked against GOV.UK on 9 October 2026.
How do I actually claim the £7,500?
You do not front the money or fill in grant forms. The scheme requires an MCS-certified installer, and that installer applies for the grant on your behalf: the £7,500 is deducted from your quote, so you simply pay the post-grant price. If an installer is not MCS-certified, the grant cannot be claimed through them.
Who is eligible for the Boiler Upgrade Scheme?
Owner-occupiers, small landlords and second-home owners in England and Wales are eligible; most new-build properties are not. The EPC-certificate precondition was removed on 28 April 2026, so you no longer need a valid EPC with no outstanding insulation recommendations to qualify. Your MCS-certified installer confirms eligibility for your specific property when they apply.
Does the Boiler Upgrade Scheme apply in Scotland or Northern Ireland?
No. The BUS covers England and Wales only. Scotland runs its own support: the Home Energy Scotland grant of up to £7,500 (rising to £9,000 with the rural and island uplift) plus an optional interest-free loan of up to £7,500 more, applied for before installation. Northern Ireland currently has no equivalent scheme, only limited efficiency support (see nidirect.gov.uk). 0% VAT on residential heat pump installations applies UK-wide until 31 March 2027.
What does a heat pump cost after the grant?
A typical air source heat pump installs for £8,000 to £14,000 before support (the official median is £12,908 for a typical 8kW system, April to June 2026). After the £7,500 grant, most households in England and Wales pay £500 to £6,500 out of pocket. Octopus Energy says its median quote was £4,064 after the grant (June to September 2026). Combi-to-cylinder conversions and radiator upgrades push toward the top of the range. Indicative as at June 2026.
What is the £9,000 oil and LPG uplift?
Until March 2027, homes heated by oil or LPG with no mains gas connection can claim an extra £1,500, so £9,000 instead of £7,500, toward an air-to-water or ground-source heat pump. Roughly 15% of GB homes are off mains gas, mostly rural, and they tend to pay the most for heating, which is why they get the larger amount.
Is a heat pump cheaper to run than a gas boiler?
At Ofgem price cap rates (electricity 26.32p/kWh, gas 7.97p/kWh from 1 October 2026), a heat pump at a seasonal efficiency (SCOP) of 3.8 to 4.5 delivers heat at roughly 5.8 to 6.9p per kWh, against roughly 8.9p for a 90%-efficient gas boiler. That puts the heat pump below gas-boiler running cost on the cap, and cheaper again on heat-pump time-of-use tariffs (tariffs change, so compare current offers). These are estimates, not quotes; run your own numbers in our calculator.
What happens to gas prices?
The Ofgem price cap gas unit rate has risen at both of the last two quarterly resets: from 5.74p to 7.33p per kWh on 1 July 2026, and to 7.97p on 1 October 2026, 39% higher than in spring. Nobody can promise where rates go next (the cap changes quarterly), but the October rate is set until 31 December 2026, and it shifts the running-cost comparison further toward heat pumps.
Do I have to replace my boiler now?
No. There is no gas ban in the UK, no end-of-life mandate and no deadline on your existing boiler. The practical play is to plan ahead: keep using and repairing the boiler you have, but when it reaches end-of-life, price a heat pump (with the grant and 0% VAT in the maths) against a new boiler before you buy another 10 to 15 years of gas exposure. Getting quotes before the boiler dies means the switch is a phone call, not a panic.
Sources and further reading
Grant amounts, eligibility and VAT were last checked against GOV.UK and HMRC on 9 October 2026; energy price cap rates are Ofgem's, to December 2026.
- GOV.UK: Boiler Upgrade Scheme, what you can get (£7,500 for air and ground source heat pumps, £2,500 air-to-air, £5,000 biomass, and the extra £1,500 until March 2027 for oil and LPG homes with no mains gas).
- GOV.UK: Boiler Upgrade Scheme, check if you're eligible (owners replacing fossil fuel heating; most new builds and social housing excluded; install within 120 days of applying).
- Ofgem Boiler Upgrade Scheme guidance for property owners and installers (v5, March 2026), including the 28 April 2026 removal of the EPC precondition.
- HMRC VAT Notice 708/6 (installations zero-rated from 1 May 2023 to 31 March 2027, then 5%).
- Ofgem price cap announcements for April-June 2026, July-September 2026 and October-December 2026 (electricity 24.67p, 26.11p and 26.32p/kWh; gas 5.74p, 7.33p and 7.97p/kWh, direct debit averages).
- Home Energy Scotland grant and loan guidance (homeenergyscotland.org, mygov.scot).
- DESNZ Boiler Upgrade Scheme statistics (median installed cost £12,908 for a typical 8kW system, April to June 2026) and Octopus Energy's published median quote (£4,064 after the grant, June to September 2026).
This page is independent editorial content. PumpSwap receives no government funding. We are a comparison platform. It is free for homeowners: an installer pays us a fixed fee only when a homeowner we introduced goes ahead with an installation. We strive for accuracy; if you spot an error, email josh@pumpswap.co.uk and we will fix it.
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