Driveway & VAT?

[unclerussty]

Just coming towards the final throws of our house build and just want to check that the replacement driveway qualifies for a VAT exemption.

 

We made a mistake with the contractor as he has done it on a supply & install basis and invoiced us including VAT (though no actual amount mentioned for VAT on invoice, his quote said VAT Inclusive - and we did discuss us claiming back the VAT on completion).  Seems we should have got him to zero rate the driveway so now need to try & reclaim the funds from him.  All through the build we have used local companies to provide materials and so we are including them in the VAT reclaim, only supply & install contractors have been electrician & heating engineers who have zero-rated.

 

So as I say just want to confirm that drive should be zero-rated and that I should be trying to get a refund from contractor.

[newhome]

Yes definitely should be zero rated. All hard landscaping, turf (not plants unless detailed in the PP), and boundary fencing qualify. 
 

 

[unclerussty]

Just now, newhome said:

Yes definitely should be zero rated. All hard landscaping, turf (not plants unless detailed in the PP), and boundary fencing qualify. 
 

 

 

Cheers newhome, I thought so but reading the regs didn't specifically mention driveways and landscaping is a wide description, open to various interpretations.

 

Thanks again

[Bitpipe]

Hard landscaping is zero rated if it is show on your planning drawings.

 

Soft ground landscaping (e.g. turf) around the new build is expected but other planting must be specifically required by planning conditions (e.g. re-instatement of a hedge or street facing greenery).

 

In reality, you should be ok to submit reasonable invoices for materials for VAT refund or get the contractor to zero rate at source and get them to do whatever you want.

 

We got our resin drive and electric gates zero rated by the respective contractor and our general landscaper zero rated his labour. The materials we claimed back on were stuff like hardcore, sand, cement, blocks, pavers, fencing & turf.

 

I don't think they'll do exact measurement on turf, pavers fencing etc but you may attract attention if you're way over what's shown on plan.

 

[newhome]

9 minutes ago, unclerussty said:

 

Cheers newhome, I thought so but reading the regs didn't specifically mention driveways and landscaping is a wide description, open to various interpretations.

 

Thanks again

Tarmac, gravel, and turf are noted here (amongst other things) so you can reclaim the vat if you buy the materials directly (or conversely get the work zero rated if someone else does the work). 

https://www.gov.uk/guidance/goods-and-services-you-can-claim-for-under-the-vat-diy-scheme#D

 

It’s also noted within VAT Notice 708 that you can point your builder at 

 

 

https://www.gov.uk/guidance/buildings-and-construction-vat-notice-708#para3-3-4

 

 

[unclerussty]

1 hour ago, Bitpipe said:

Hard landscaping is zero rated if it is show on your planning drawings.

 

Soft ground landscaping (e.g. turf) around the new build is expected but other planting must be specifically required by planning conditions (e.g. re-instatement of a hedge or street facing greenery).

 

In reality, you should be ok to submit reasonable invoices for materials for VAT refund or get the contractor to zero rate at source and get them to do whatever you want.

 

We got our resin drive and electric gates zero rated by the respective contractor and our general landscaper zero rated his labour. The materials we claimed back on were stuff like hardcore, sand, cement, blocks, pavers, fencing & turf.

 

I don't think they'll do exact measurement on turf, pavers fencing etc but you may attract attention if you're way over what's shown on plan.

 

The drive wasn't included in the plans at all - we knocked down the existing bungalow to build the new house, and the tarmac drive was wrecked in the process, the existing garage has also remained in place.  I think the only reference to the drive in the planning was that we had to maintain a turning circle so that the cars weren't reversing out on to the road.

 

I'll ask the contractor to zero rate it and hopefully he'll give us a refund as we've already paid him!!

[Bitpipe]

19 hours ago, unclerussty said:

The drive wasn't included in the plans at all - we knocked down the existing bungalow to build the new house, and the tarmac drive was wrecked in the process, the existing garage has also remained in place.  I think the only reference to the drive in the planning was that we had to maintain a turning circle so that the cars weren't reversing out on to the road.

 

I'll ask the contractor to zero rate it and hopefully he'll give us a refund as we've already paid him!!

 

Much like a lawn that gets wrecked during a build, you'd be entitled to re-instate it.

 

May be tricky to get the contractor to re-invoice you but they have 4 years to correct their VAT return so it's feasible.

 

You will want to speak to their accounts dept (or accountant / book keeper) and say that you'll be making a submission to HMRC VAT in relation to the build (quote the scheme details etc) and advise them that as they've incorrectly collected VAT this may create an issue for them.

 

Most firms want to be squeaky clean on VAT so should want to sort it out - it's not as if its their money anyway.

 

However I was in a similar situation with a ground investigation company I used at the outset of the build process. I should have ensured that on site activities were zero rated but the advice is not black and white and I was unsuccessful in persuading them a few years later.

 

Good luck!

 

 

[unclerussty]

1 hour ago, Bitpipe said:

 

Much like a lawn that gets wrecked during a build, you'd be entitled to re-instate it.

 

May be tricky to get the contractor to re-invoice you but they have 4 years to correct their VAT return so it's feasible.

 

You will want to speak to their accounts dept (or accountant / book keeper) and say that you'll be making a submission to HMRC VAT in relation to the build (quote the scheme details etc) and advise them that as they've incorrectly collected VAT this may create an issue for them.

 

Most firms want to be squeaky clean on VAT so should want to sort it out - it's not as if its their money anyway.

 

However I was in a similar situation with a ground investigation company I used at the outset of the build process. I should have ensured that on site activities were zero rated but the advice is not black and white and I was unsuccessful in persuading them a few years later.

 

Good luck!

 

 

Cheers

[Temp]

He might reply that it was zero rated already. Especially if the invoice didn't specify the percentage. Does the quote say anything?

[unclerussty]

19 hours ago, Temp said:

He might reply that it was zero rated already. Especially if the invoice didn't specify the percentage. Does the quote say anything?

Quote just said £x including VAT. I would have expected it to say zero rated somewhere in the quote if that was the case.

[Bitpipe]

On 17/12/2020 at 10:39, unclerussty said:

Quote just said £x including VAT. I would have expected it to say zero rated somewhere in the quote if that was the case.

 

What does your final invoice say? Should have his VAT number.

 

If they get awkward, just say you've already notified HMRC and they've taken note and are expecting him to refund...