VAT reclaim self build made easy

VAT reclaim self build

DIY house builders VAT reclaim self build is not always straight forward. When submitting a VAT reclaim for your self build project you should consider whether or not your supplier has charged you VAT at the correct rate. Where a supplier charges VAT incorrectly at 20% you should seek reclaiming VAT from your supplier.

Planning permission

Having the correct planning permission is essential. The planning permission may indicate a proposed use of he premises. Planning permission for a dwelling incorporating bed and breakfast facilities would not enable a build VAT reclaim using the DIY housebuilders scheme.

Intention

Recovering the VAT from your self build can encounter other difficulties. To be a valid claim the construction must be undertaken “otherwise than in the course or furtherance of any business”. One of our clients recently had a dispute with HMRC in relation to this based on HMRC’s contention that our client never intended to occupy the property.

HMRC recognise that during the process of a VAT reclaim self build that peoples circumstances may change and consequently the intention with regard to the dwelling may also change.

Incidental economic activity

VAT reclaim self build is possible if there has been incidental economic activity that can be disregarded. An example of this would be the selling or letting of the dwelling soon after completion as a result of the breakdown of a marriage.

ADR

By the time the case had been referred to us it seemed that both sides positions had become entrenched. One our VAT ADR specialists made the appropriate applications and the matter was accepted into ADR. At the ADR mediation meeting our client had the opportunity to present further information to HMRC.

Outcome

The VAT ADR process was successful which in our experience is often the case. Our clients VAT reclaim self build repayment was received after some agreed adjustments. Our client commented that “it could not have gone any better”.

HMRC

HMRC’s internal manual on VAT construction offers an insight into VAT reclaim self build potential issues.

Our VAT experts

Let us help make your VAT self build claim easy. Solve VAT can be contacted on 0161 883 2120.