What is an EPC exemption, and would you actually get one?

Most landlords I speak to have heard there's a way out of the EPC rules. They're half right.

Exemptions are real and plenty of properties will end up using one. But they're not a loophole you can lean on, and they're definitely not automatic. You have to apply, with evidence, and they run out.

Here's how it works.

The short version

If getting your property to a C rating would cost more than the government says you have to spend, you don't have to spend it. You spend up to the cap, register an exemption, and carry on letting.

The cap under the proposed 2030 rules is £10,000 per property. For properties worth under £100,000 it drops to 10% of the value instead, so a £70,000 flat has a £7,000 cap.

Worth saying up front that these rules aren't law yet. The direction has been clear for a while, but the detail could still move.

The types you're most likely to need

You've spent up to the cap and you're still short

This is the big one. You do the work, you hit the spending limit, the property still isn't a C. You register, and you're covered.

The thing people miss is that you do actually have to spend the money first. You can't look at a £14,000 quote, decide it's over the cap, and register an exemption having spent nothing. You work down the list until the money runs out.

The work would damage the property

Some measures aren't sensible on some buildings. Internal wall insulation on a damp solid-wall terrace can cause more problems than it solves, and external insulation on a period front is usually a non-starter.

You need a report from a suitably qualified person saying so. Not your builder's opinion over a cup of tea.

The tenant or a third party said no

If you need consent and you can't get it, that's an exemption. Freeholders, planning, lenders, and tenants who won't let the work happen all count.

You need to show you asked and got turned down. Keep the emails.

Listed buildings

This one gets misunderstood a lot. Being listed doesn't automatically exempt you. It exempts you where the work would unacceptably change the character of the building, which is a different thing and still needs evidence.

You have to register it

Exemptions go on the PRS Exemptions Register. It's free and it's public.

Nothing happens by default. If you're sitting on a property that you reckon qualifies and you haven't registered, you're not exempt, you're just non-compliant. Fines under the proposed rules go up to £30,000 per property.

They don't last forever

Most exemptions run for five years. After that you have to look again, because costs change and so does what's available.

They also don't pass to a new owner. If you sell, the buyer starts from scratch and inherits the problem, which is worth knowing if you're planning to exit.

What I'd do first

Before you get anywhere near the exemption question, get clear on what reaching a C rating would actually cost.

Most people take the number off their certificate, which lists improvements in an order aimed at the best possible rating rather than the one the law asks for. That usually overstates the cost, sometimes by thousands, and it can push you into thinking you need an exemption when you don't.

Work out the cheapest route to a C rating first. Then see if it's over your cap. If it is, the exemption route is worth a proper look.

You can check any property here and we'll show you both numbers.