VAT for barn convertors
There is an update to this post at … VAT for barn convertors update December 2007
Having been confused by the VAT treatment around barn conversions for some time, I thought I’d better get the situation clear before going any further. This is a summary of the VAT situation currently:
Conversion of a building to a residence is free of VAT paid on labour and materials.
You can reclaim the VAT paid on labour and materials without having to be VAT registered.
The relevant legislation is ‘Customs & Excise Notice 719 - VAT Refunds for DIY Home Builders and Converters‘.
A VAT registered builder should invoice you for their labour and any materials they purchase at the reduced VAT rate of 5%. This along with the full rate VAT paid on materials you have purchased can be reclaimed from your local Customs & Excise VAT office once the project has been completed. You’ll need all appropriate receipts to make the claim.
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Posted in Essential information for barn converters |
July 18th, 2007 at 7:50 am
how can we invoice customers at 5% vat on materials when i am charged the full 17.5% at purchase?
July 18th, 2007 at 10:14 pm
g mann, my understanding is that a VAT registered builder can reclaim the difference in the VAT rate paid on materials and the VAT rate that is applicable in the same way as the client could.
August 25th, 2007 at 3:04 pm
how does the 5% rule work for payments to kitchen and bathroom installations carried out by other contractors than the main builder
August 28th, 2007 at 7:29 pm
peter, can’t say I’ve done it personally, but my understanding is that you would need to pay the VAT under those circumstances, then reclaim from your local Customs & Excise VAT office once the project has been completed
August 31st, 2007 at 5:28 pm
thanks for the answer, do you know if it would be 5% or 17.5%?
November 28th, 2007 at 1:58 pm
My understanding is all the VAT you’ve paid at either rate can be reclaimed in a one-off claim following completion of the conversion.