5% VAT for renovating unoccupied house

[Jeremy]

I've gotten official confirmation from local council that the former occupant of a home I'm just about to start renovating was deceased more than 24 months ago. I'm pretty confident this means that I qualify for 5% VAT on materials used in the renovation. I gather this will certainly apply with those trades that I can get to apply the 5% rate for materials they use, but I'm also planning to do quite a lot of work myself. Has anyone found a vendor or supplier who can provide timber, sheet goods, insulation, plasterboard etc. at 5% VAT for self-build work?

[newhome]

4 minutes ago, Jeremy said:

I'm pretty confident this means that I qualify for 5% VAT on materials used in the renovation.

Unfortunately it doesn’t mean this. The only way of getting VAT @ 5% is to get a VAT registered builder to do the work on a supply and fit basis. If you buy materials to do the work yourself you will have to pay VAT @ 20%. 
 

 

 

[Temp]

Have you moved in or is it still empty? Your builder must start work before you move in to get the vat reduction

Edited February 13, 2021 by Temp

[newhome]

1 minute ago, Temp said:

Have you moved in or is it still empty? Your builder must start work before you move in to get the vat reduction

Yes and then you have to stick with the same builder, ie you can’t employ a different builder a few weeks down the line. The work also has to be completed within a year of the property being acquired if you live in it before work starts. 
 

 

[Jeremy]

57 minutes ago, Temp said:

Have you moved in or is it still empty? Your builder must start work before you move in to get the vat reduction

Haven't moved in yet - plan to do 8 weeks of reno first - so ok on that front.

[Jeremy]

48 minutes ago, newhome said:

Yes and then you have to stick with the same builder, ie you can’t employ a different builder a few weeks down the line. The work also has to be completed within a year of the property being acquired if you live in it before work starts. 
 

 

Ah, ok. Well, that's good to know. But seems like all these conditions would probably end up increasing my budget by much more than 15%, so I guess not worth the trouble, alas. Might see if I can get this applied for a single big ticket item (in-wall insulation maybe).

[Temp]

53 minutes ago, newhome said:

Yes and then you have to stick with the same builder, ie you can’t employ a different builder a few weeks down the line. The work also has to be completed within a year of the property being acquired if you live in it before work starts. 
 

 

 

That second rule is a life saver for people that only hear about the scheme after they move in.

[Oz07]

I've used this before. Only really works well when you have own VAT registered company.