Reclaiming VAT from house build!

missile

I am putting wooden floor and tiles in a new appartment. Can you recalim all the VAT when the invoice is for supply and fit including VAT on both?

missile

It is a new flat which has not been completed and I have not moved in.

According to http://customs.hmrc.gov.uk/channelsP...HMCE_CL_000150 I ought to be able to claim VAT on goods, but I would be interested to hear from anyone who has and not too sure whether I can also reclaim VAT charged for fitting?

windym_2

missile wrote:

I am putting wooden floor and tiles in a new appartment. Can you reclaim all the VAT when the invoice is for supply and fit including VAT on both?

Both are reclaimable. If the goods are supply and fit then you should ask your fitter to zero rate (if new build) or reduce rate (if conversion) if he is VAT registered. If he isn't VAT registered then he cannot charge you VAT.

Altarf wrote:

Is the apartment still being built or is it complete but you have just not moved in yet. If it is the former, then possibly you can get it zero rated. If it is the latter, you are out of luck.

It is absolutely nothing to do with when you move in. People get confused between moving in and completion. It is the date of your completion that counts (the date the Building Insp. makes his last visit and signs you off.)

missile wrote:

According to http://customs.hmrc.gov.uk/channelsP...HMCE_CL_000150 I ought to be able to claim VAT on goods, but I would be interested to hear from anyone who has and not too sure whether I can also reclaim VAT charged for fitting?

As I said above, if the fitter is VAT registered he should zero rate the work. If he doesn't know how to do this, then give him a copy of the HMRC booklet (from your VAT office). Or print it out from their website.

Hth.

missile

Thanks, been to several shops they say VAT is only re-claimable on the materials. These are reputable firms John Lewis, General George and Berryden Carpets. Rather than argue the toss, if I simply pay him the VAT can I then re-claim it?

windym_2

Altarf wrote:

Only if it is a conversion not a new construction. If it is a DIY house build then VAT on services cannot be reclaimed, only VAT on goods.

Originally Posted by missile
I am putting wooden floor and tiles in a new appartment. Can you reclaim all the VAT when the invoice is for supply and fit including VAT on both?
Replied by windym
Both are reclaimable. If the goods are supply and fit then you should ask your fitter to zero rate (if new build) or reduce rate (if conversion) if he is VAT registered. If he isn't VAT registered then he cannot charge you VAT.

I concede the word reclaimable is not quite the right one when you take the sentence out of context. But taken in context with the next sentence I quantified it CORRECTLY by saying 'If the goods are supply and fit then you should ask your fitter to zero rate (if new build) or reduce rate (if conversion) if he is VAT registered. If he isn't VAT registered then he cannot charge you VAT.' So in essence, you should not pay VAT on fitting. If you are charged VAT by your fitter it can be rectified (better word?) by referring them to Notice 708, whereby they should send you out a revised invoice.

Altarf wrote:

There is no single test that says whether a building is complete. A certificate of completion is only one factor. However if you have moved in it is likely that it is completed, although it may have already been completed at some point before you move in. Rarely would it be completed after you move in, but it is not impossible.

Not quite correct, HMRC take the last possible date as 3 months after the completion certificate has been issued. But even then, is certain cases you can appeal with exceptional reason.

Claims must be made no more than three months after the construction or conversion is completed. (section 10.2).

Normally this is when it has been finished according to the original plans. In cases of doubt, a building can be regarded as still under construction up until the date when a certificate of completion is issued by the local planning authority. (10.3).

My neighbour lived in his property for 11 years before it was completed. I am living in mine which is not completed (not for the first time either). I have no statistics which can quantify 'rarely'. But it is more usual than rare.

Altarf wrote:

It is then too late for the third party contractor to zero rate as the building has been completed.

You should be careful to ensure that you are charged the correct amount of VAT, as you can only reclaim VAT that has been correctly charged. If the building is 'completed' (certificated) then you cannot reclaim VAT on goods/services after this. If it is a case of the developers have left and the property is still 'under construction' then the normal rules apply.

I think Altarf will agree with me that all this information is available on the HMRC website. Sometimes the information may be ambiguous and can be interpreted in several ways. If in doubt, then email your VAT office with your details and they will issue you a reply specific to your query.

windym_2

missile wrote:

Thanks, been to several shops they say VAT is only re-claimable on the materials. These are reputable firms John Lewis, General George and Berryden Carpets. Rather than argue the toss, if I simply pay him the VAT can I then re-claim it?

No, as I said above, You should be careful to ensure that you are charged the correct amount of VAT, as you can only reclaim VAT that has been correctly charged. If you are not certified as completed, then ask him to re-issue your invoice (under Notice 708 Builders & Construction) without the VAT (assuming he is VAT registered).

On the subject of John Lewis, I can't think of much that they sell which is reclaimable (bathroom fittings maybe). Certainly carpets and white goods are not included in the refund scheme . You can get a full list here: http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageContactUs_ShowContent&id=HMCE_CL_000150&propertyType=document#P230_22306 at section 8.3 to 8.11.

missile

Hi windym,

John Lewis do sell wooden flooring which is listed as an item where one can reclaim VAT. In this case the builder has permitted access for fitment prior to completion. I am flooring a large area at a cost of nearly £6,000 so the reclaim is well 17.5% of £6,000.

windym_2

I wish I lived near John Lewis! To calculate VAT (just in case you didn't realise) the easiest way is to take the gross amount:

£6000
Divide by 47 (127.65)
Multiply by 7
VAT is therefore £893.62

missile

Windym, thanks for the tip, but I got a calculator :rotfl:

John Lewis do sell on line and via catalogue mail order and offer a price match. Unfortunately they do not stock the particular flooring we want.