EPC exemptions for landlords

Landlords can apply for 5-year exemptions from the minimum E rating in specific circumstances.

What are EPC exemptions?

Since April 2020, landlords in England and Wales cannot let properties with an EPC rating below E (F or G ratings) unless they have a valid exemption. Exemptions are available in specific circumstances where it is not reasonable to require the landlord to upgrade the property to meet the minimum standard.¹

Exemptions last for 5 years and must be registered on the national PRS (Private Rented Sector) Exemptions Register before the property can be legally let. Landlords who let a sub-E property without a registered exemption face fines of up to £5,000 per property.

Exemptions are designed to cover situations where improvements would be disproportionately expensive, technically impossible, or would damage the property. They are not intended as a way to avoid reasonable upgrades, and landlords must provide evidence to support their exemption claim.

Types of exemption available

There are six main exemption categories for landlords:¹

All relevant measures installed

You have installed all cost-effective energy efficiency improvements (as recommended on the EPC or by a surveyor), but the property still does not reach E. This is the most common exemption for hard-to-treat properties.

Cost cap exceeded

All recommended improvements would cost more than £3,500 (including VAT). You are not required to spend more than this amount, even if it does not achieve an E rating.

Third-party consent refused

You cannot get consent for improvements from a tenant, superior landlord, mortgage lender, or local planning authority (for listed buildings or conservation areas). You must provide evidence of refusal.

Property devaluation

An independent surveyor has confirmed that the improvements would reduce the market value of the property by more than 5%. This is rare and requires a formal valuation report.

Recently became a landlord

You acquired the property within the last 6 months and there is a valid EPC showing F or G. This gives you 6 months to either upgrade or register a different exemption. Temporary exemption only.

Temporary exemption for new tenancy

Available for up to 6 months if improvements are in progress or funding has been approved but works cannot be completed before the new tenancy starts. Must provide evidence of progress.

The most commonly-used exemptions are "all relevant measures installed" (after spending the £3,500 cap) and "third-party consent refused" (particularly for listed buildings where planning permission is denied).

The £3,500 spending cap exemption

Landlords are only required to spend up to £3,500 (including VAT) on energy efficiency improvements to meet the minimum E rating. This cap has been in place since 2020 and applies across all improvements made since 1 October 2017.²

How the £3,500 cap works

The spending cap is cumulative. If you have already spent money on improvements since October 2017, this counts towards the £3,500 limit. For example:

• If you spent £1,000 on loft insulation in 2018, you only need to spend a further £2,500 to reach the cap
• If you have spent nothing, you must spend the full £3,500 before claiming an exemption
• If you spent £4,000, you have already exceeded the cap and can claim an exemption immediately (if the property is still below E)

What counts towards the £3,500

The following count towards the cap:

• Costs of measures recommended on the EPC certificate
• Installation costs including labour, materials, and VAT
• Ancillary works needed to install the measure (for example, scaffolding for external wall insulation)
• Survey or assessment costs to determine what improvements are feasible

Routine maintenance and repairs do not count. For example, replacing a broken boiler like-for-like is maintenance. Upgrading to a more efficient boiler counts as an improvement.

Registering the cap exemption

To claim an exemption based on the £3,500 cap, you must provide evidence of spending. This typically includes:

• Invoices for all improvement works carried out since October 2017
• Quotes showing that further improvements would exceed the remaining budget
• A new EPC showing the property is still below E after the improvements

Once registered, the exemption lasts for 5 years, even if the property is re-let to new tenants during that period.

How to register an exemption

All exemptions must be registered on the PRS Exemptions Register at prs-exemptions.service.gov.uk before you can legally let the property.³

The registration process is:

1. Create an account on the PRS Exemptions Register using your email address
2. Select the exemption type that applies to your property (for example, "cost cap exceeded" or "all measures installed")
3. Enter property details including address and EPC reference number
4. Upload evidence to support your exemption claim (invoices, quotes, surveys, or consent refusals)
5. Submit the registration — you will receive a confirmation email with the exemption reference number

There is no fee to register an exemption. The exemption is publicly visible on the register, so prospective tenants and enforcement officers can verify it.

You must register the exemption before the tenancy starts. Registering it afterwards does not protect you from penalties for the period when the property was let without a valid exemption or EPC.

Evidence needed for exemptions

Each exemption type requires specific evidence:¹

Cost cap exceeded

Invoices for work already done, plus quotes showing remaining recommended measures would exceed £3,500. A new EPC showing the property is still F or G after the work.

Third-party consent refused

Written evidence of refusal from the tenant, freeholder, lender, or planning authority. For listed buildings, a formal refusal of listed building consent or planning permission.

Property devaluation

A formal valuation report from a RICS-qualified surveyor stating that the improvements would reduce the property's value by more than 5%. The report must specify the measures and the estimated devaluation.

Technical feasibility

A surveyor's report or specialist assessment confirming that the recommended measures cannot be installed (for example, due to structural constraints, listed building protections, or lack of space).

All relevant measures installed

Invoices for all improvements completed, a new EPC showing the property is still below E, and evidence that no further cost-effective measures are available (such as a retrofit assessment or surveyor's report).

Evidence must be clear, dated, and from credible sources (accredited installers, qualified surveyors, or official bodies). Anecdotal claims or estimates are not sufficient.

How long exemptions last

Most exemptions last for 5 years from the date of registration. After 5 years, the exemption expires and the landlord must either:⁴

• Upgrade the property to reach at least an E rating
• Register a new exemption if the original circumstances still apply (for example, if improvements are still not cost-effective or feasible)
• Stop letting the property until it meets the minimum standard

The 6-month temporary exemptions (for new landlords or works in progress) are shorter and expire after 6 months. At that point, the landlord must either complete the upgrade or register a different exemption if eligible.

Exemptions do not transfer automatically when the property is sold. If you buy a rental property with an existing exemption, you inherit the exemption for the remainder of its 5-year period. However, you should verify the exemption is valid and understand what improvements (if any) were already made.