Budget Surprise for Listed Buildings
With the unexpected news in last month’s Budget announcing the removal of the zero rate for alterations to protected buildings, our resident VAT and property experts Karen Mulcahy and Sarah Franklin will be holding a FREE webinar on Thursday 19th April at 12.00 midday to discuss the practical implications of these changes.
Aimed at Architects, Property Developers and anyone who is currently involved in or advising on a project of this kind, you will:
- Find out the specialists’ view on the proposed changes
- Understand the implications for you or your clients’ projects
- Opportunity to join the discussion
- Take a part in responding to the consultation document
To register your place click here
Getting the correct planning permission – a good foundation for any building project
A costly reminder that having the correct planning permission in place prior to works commencing has been highlighted in the recent case of building contractors AbbeyTrust Homes Limited. Zaenia Rogers, Consultant at The VAT Consultancy, takes a look.
The main point of the appeal revolved around the planning permission for a new build. In short, when HMRC requested a copy from the contractor of the planning permission to substantiate the zero rating on their construction supplies (and thus a large repayment return of c£34k), it was found that the permission actually stated that an extension was taking place. The case continues with retrospective permission being granted, but the Tribunal quite rightly stated that there is “no basis by which the retrospective provision of the planning consent many months after the Appellant had received payment for supplies can alter the tax treatment of those supplies”.
It is useful to note HMRC did accept that any payments for services after the retrospective permission was granted could be at the zero rate, but that condition (d) of Note 2 of Schedule only states a building is a dwelling if the relevant statutory permission has already been granted.
Whether you are the property owner, contractor or architect, we would always advise that the impact of VAT needs to be considered at the very beginning of any building project.
The impact of not having the correct planning permission in place at the beginning of the project as highlighted in the case above would have an effect on all budgetary aspects of the build, not to mention the cost and stress associated with the legal struggle to get the situation corrected.
We can work with you on your planning permission request to ensure you achieve the VAT rate you require to minimise VAT as a cost to the project as well as work with contractors along the way to ensure they are applying the right rate of VAT to their supplies. Land and property is a notoriously complex areas of VAT, yet one of the areas where, if managed carefully, the potential for VAT savings is enormous.
If you would like to discuss wording for your planning permission to ensure you achieve the VAT rate you require for your building project or if you need any other VAT element of your project confirming, then please do not hesitate to contact me: zaenia.rogers@thevatconsultancy.com.