Air and ground source heat pumps for rural homes

Grants and tax relief

• England and Wales: the Boiler Upgrade Scheme gives £7,500 towards an air source or ground source heat pump, and £2,500 for an air-to-air heat pump. Until March 2027, you can get an extra £1,500 for an air or ground source heat pump if your home is heated by oil or LPG and has no mains gas connection. You can get one grant per property (GOV.UK). The scheme is open in England and Wales (GOV.UK).
• Scotland: Home Energy Scotland offers grants of up to £7,500 for a heat pump, with an optional interest-free loan for the rest. A £1,500 rural and island uplift applies to both the heating and energy efficiency grants, so rural households can claim up to £18,000 in grant funding (Home Energy Scotland).
• VAT: installing heat pumps in homes is zero-rated from 1 May 2023 to 31 March 2027, reverting to 5% from 1 April 2027 (HMRC VAT Notice 708/6).

For the Boiler Upgrade Scheme, GOV.UK advises speaking to an MCS certified installer (GOV.UK). See MCS for what certification covers.

Planning permission

In England, Class G of Part 14 of the General Permitted Development Order allows many air source heat pumps without a planning application, subject to conditions that were amended in May 2025 (GPDO Part 14). Listed buildings, conservation areas and Scotland, Wales and Northern Ireland have different rules, so ask your installer and council.

Is a heat pump right for an old rural house?

It can be, but the design matters. A good installer will do a room-by-room heat loss calculation and may suggest insulation or bigger radiators first. Old solid-walled houses need care, because the wrong insulation can trap damp (see our damp and old buildings page).