VAT is not charged on water supplied to domestic and non-industrial business customers, as these supplies are zero-rated. However, if your business is classified as engaging in a Relevant Industrial Activity, VAT must be added to your water bill.
Typically, the disposal and treatment of sewerage and wastewater are zero-rated for VAT. Therefore, VAT may only be applied to the water supply portion of your bill if you engage in a Relevant Industrial Activity.