The £10,000 EPC cost cap explained, with worked examples
Short answer. Under the 2030 energy standard for privately rented homes, landlords must spend up to £10,000 per property to reach the equivalent of EPC C. Spend on relevant measures installed since 1 October 2025 counts. Third-party funding counts towards the cap, except Boiler Upgrade Scheme grants, and reasonable EPC assessment costs count. If the cap is reached and the next recommended measure would exceed it, the landlord can register a cost cap exemption valid for 10 years. Homes valued under £100,000 have a lower cap of 10% of their value. The cap is very likely VAT-inclusive, as today's £3,500 cap is, but check the final regulations. Keep every invoice.
The cost cap is the most important number in the 2030 rules for most landlords. It decides how much you must spend on each property before you can stop. This guide explains how it works and runs through worked examples.
The cap is confirmed policy from January 2026, but the regulations are not yet made. The examples use typical figures to show the rules. They are not quotes and not legal advice.
The basics
- £10,000 per property. Not per landlord, not per portfolio.
- Spend since 1 October 2025 counts, on relevant energy efficiency measures installed since then.
- Third-party funding counts, such as grants or supplier schemes, except Boiler Upgrade Scheme funding.
- EPC costs count where reasonable. Some specialist retrofit advice may count too.
- Low-value homes under £100,000 have a cap of 10% of value.
- The exemption lasts 10 years once registered.
Today's cap is £3,500 including VAT, with spend since 1 October 2017 counting. That still applies to F and G rated homes until the new rules start.
Is VAT included
The government response describes the high-cost exemption as comparing costs including VAT against the cap. Today's cap is VAT-inclusive. We expect the £10,000 cap to be the same, but we have not seen a line that says so outright. Treat it as likely, and check the final regulations. Note that many energy saving materials currently qualify for zero-rate VAT when installed, which helps either way.
Example 1: a 1930s semi rated D
A three-bed semi scores 62 (band D). The EPC recommends cavity wall insulation, a loft top-up and heating controls.
| Measure | Cost | Running total |
|---|---|---|
| Cavity wall insulation | £2,200 | £2,200 |
| Loft top-up to 270mm | £600 | £2,800 |
| Heating controls | £600 | £3,400 |
| Post-works EPC | £100 | £3,500 |
The new EPC shows C. No exemption needed. The landlord spent well under the cap. This is the most common pattern for cavity-walled homes.
Example 2: a Victorian terrace that hits the cap
A solid-walled terrace scores 48 (band E). In November 2025 the landlord insulated the loft for £900. That counts, because it was installed after 1 October 2025.
| Measure | Cost | Running total |
|---|---|---|
| Loft insulation (November 2025) | £900 | £900 |
| Heating controls | £600 | £1,500 |
| Suspended floor insulation | £1,800 | £3,300 |
| Condensing boiler replacing an old boiler | £3,500 | £6,800 |
| LED lighting | £150 | £6,950 |
The property now scores 64, still D. The next recommendation is internal wall insulation at about £9,000. That would take spend to £15,950, over the cap. The landlord can register a cost cap exemption, valid for 10 years. They might also qualify to decline solid wall insulation under the new solid wall exemption.
Before registering, check whether any remaining recommended measure fits within the £3,050 left. The cost cap exemption is for when the next measure would exceed the cap. Check gov.uk for the final evidence rules.
Example 3: a low-value flat
A one-bed flat is valued at £90,000. Under the Property Value Adjustment exemption the cap is the lower of 10% of value and £10,000, so £9,000. If the landlord spends £9,000 on relevant measures and the property is still below C, they can register this exemption for 10 years. You will need evidence of value, and the government will set out what is acceptable.
Example 4: spend before the cut-off
A landlord fitted new double glazing in July 2025 for £5,000. That was before 1 October 2025, so it does not count towards the £10,000 cap. The improvement still shows on the EPC, so it may reduce what else is needed. It just does not reduce the cap.
Example 5: grants and heat pumps
A landlord fits an air source heat pump costing £12,000 and receives a £7,500 Boiler Upgrade Scheme grant. The government says Boiler Upgrade Scheme funding does not count towards the cap. On our reading, only the landlord's own £4,500 counts. Other third-party funding, such as a supplier grant for insulation, does count. This detail matters for planning, so check the final regulations.
Keep the evidence
- Itemised invoices showing date of installation, measure and price including VAT.
- Grant or funding letters.
- Before and after EPCs.
- Quotes for the next measure if you plan to register an exemption.
- Photos where useful, such as loft depth.
False or misleading exemption entries can be fined. Evidence protects you. PlutoHome keeps a running spend total for each property so you can see how close you are to the cap.
Questions
Is the £10,000 cap per property or per landlord?
Per property.
Does work I have already done count?
Spend on relevant measures installed since 1 October 2025 counts. Earlier work does not count towards the cap, though it still shows on the EPC.
Does the cap include VAT?
Very likely. The response compares costs including VAT for the high-cost exemption, and today's cap includes VAT. Check the final regulations.
Do grants count towards the cap?
Third-party funding counts, except Boiler Upgrade Scheme funding.
How long does a cost cap exemption last?
10 years once registered on the PRS Exemptions Register.
My flat is worth less than £100,000. What is my cap?
The lower of 10% of its value and £10,000.
Does the cost of an EPC count?
Reasonable EPC assessment costs count, with amounts to be set out by government.