Get the VAT back!

Scottish Field - - ABODE -

An­drew Jones is a spe­cial­ist in re­claim­ing VAT, a tax which is a tricky sub­ject at the best of times. Here An­drew of­fers some brief point­ers to help you on the way. You qual­ify for a zero-rated build IF...

• you build a new dwelling or pur­chase a shell and bring the new build to com­ple­tion.

• You or a fam­ily mem­ber in­tends to live there.

• The build­ing has no plan­ning re­stric­tions with re­gards to dis­posal later on; or used in con­nec­tion with an­other ex­ist­ing prop­erty and may not be used as a busi­ness, sold, rented out or leased.

• You con­vert a pre­vi­ously non res­i­den­tial prop­erty into a dwelling or a dwelling that has been empty for 10 years or more (you would need a pa­per trail to prove this).

• Re­duced VAT rate at source - if any VAT regis­tered busi­ness should sup­ply labour, or labour and ma­te­ri­als, to the job you should pay the re­duced rate of five per cent VAT.

• VAT re­claim - on com­ple­tion of the build, VAT paid on qual­i­fy­ing ma­te­ri­als pur­chased at 20% VAT can be re­claimed along with any 5% in­voices.

If you pay the wrong rate of VAT to a con­trac­tor for sup­ply­ing fit­ting or labour­ing this can­not be re­claimed from HMRC, ir­re­spec­tive of the fact HMRC has al­ready re­ceived the VAT from the con­trac­tor. You will achieve zero rat­ing VAT in two ways, or a com­bi­na­tion of both

• Zero rat­ing at source: if any VAT regis­tered busi­ness comes and sup­plies labour or labour and ma­te­ri­als to the job, you should not pay that com­pany any VAT at all.

• VAT re­claim: on com­ple­tion of the build, VAT can be re­claimed from HMRC Get­ting a re­duced rate of VAT cer­tifi­cate helps you get this charged to you cor­rectly.

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