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Our VAT reclaim: a car-crash in the making?


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3 hours ago, pocster said:

But do I need it ? . I don’t want to trigger anything ( Hmrc wise ) . Or just do nothing ? . Move in , pay council tax ….


No you don’t need it. I never had one, I just waited for the completion certificate. You only need it if you want to live in the house with the council’s blessing but I don’t think many councils will care much as you have planning permission and will be paying council tax. 

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In Scotland you are not supposed to occupy a house until you have completion or a temporary habitation certificate.  A Temporary habitation is provided by building control on request.  For that they had to do and inspection, and made is do a few things that they deemed not ready.  We also had to provide the electrical certificate, gas safe certificate and unvented cylinder G3 signoff.

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16 hours ago, newhome said:

...  but I don’t think many councils will care much as you have planning permission and will be paying council tax. 

 

@pocster, here be DRAGONS. 

I respect @newhome's opinion: she's highly ikely to be right. But likely isn't certainty.

What are you going to do when a Council Offical turns up on site - sniffs around and says that in his / her opinion you have a HABITABLE dwelling?  (see @joe90's post earlier) Thats one of the  keys now - not COMPLETION  or Entry Into The Valuation List.  It's that undeclared shift of focus from one to other that @newhome flags up in her excellent post here.  (in the first few lines)

 

The HMRC  form VAT431NB  only mentions Completion  or entry into The Valuation List. It does not mention declaring  the building status as HABITABLE as a key date in HMRC's decision-making process. 

 

Here's the workflow that happened in my case. Just a list of facts - no emotion.

(I can already hear @ProDave wincing, sucking his teeth and playing bagpipes upside down - no kilt)

 

  • Lockdown 1 has just finished : muggins is digging his foul drains by hand .
  • Very nice lady from Wyre Valuation Office, clipboard, walks on site  (Oh how i wish I'd taken @Jeremy Harris advice - the HERAS and notice argghhhh)
  • We had an intial conversation about when / if I'd moved in : spare you the details
  • We agreed - substantiated by a follow up email - that I'd tell her when we were 'in'
  • Target date was january 2021 ish. Difficult to estimate because of COVID and DIY Max.
  • Second visit of nice lady late 2020: we agree a move in date of December 1st 2020. Loads still to do on house. I question her closely on the criteria applied for her decision, and accept her judgement.
  • Week after April 21st 2021, nice lady writes to me with a copy of the Entry into Valuation List (from the Valuation Office) , that document is  dated 21st April 2021.

That is the date mentioned in the HMRC Guidance (pages 6 and 7) as the date when the clock startes ticking in terms of submitting the reclaim form.

  • July 2021 I submit my VAT claim
  • This week, the HMRC write to me asking me to list the jobs I have done since December 2020.
  • @Temp agrees with my suspicion: they are lining themselves up to disallow the VAT reclaimed between 1st December 2020 and July 2021 (submission date for the form)

The issue I would like to draw to everyone's attention is that the form VAT431NB does not mention the date at which a house is accepted as being inhabited  (called occupancy)   as a new key date used by HMRC . Occupancy is an additional key indicator they now use .

 

My objection is that they do not tell you that on the form.

 

That's the dragon referred to above. They don't tell ya.

 

Had it not been for @newhome's alertness and depth of study, we'd all still be in the dark. 

 

Now for a bit of emotion.

The level of laziness and lack of customer focus on the part of an organsiation the size of HMRC is simply inexcusable. That kind of behaviour engenders  - justifies almost - mendacity on the part of customers. 

Hence @ProDave's post (I think) '... never admit you're occupying the house you've built' until after completion.

And why he's even now playing the bagpipes upside down somewhere in Bonnie Scotland.

 

Can't take a joke? Don't start a self build eh? Honest. Just don't start.

 

 

 

 

 

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If you have a ‘feature’ that bco would wince at say for example a dodgy temporary staircase - would that deem it not habitable? . So you live on site but not habitable . Another condition we all need is fire alarms - yet I have none installed . So bco might deem these things as not complete . I’m just concerned as I get the robot from the council out for tax valuation they obviously have to add the property to the list - but I don’t want the word habitable anywhere .

Perhaps get the fire brigade to take a look ? . Fairly certain they will be shocked - they surely could write a short letter stating ‘ dangerous ‘ , ‘ incomplete’ and not fit for habitation perhaps ???

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Covid has changed things.  I used to get monthly visits from the council fax man, first to see if we had moved into the caravan and then to see if we had moved into the house.  The last time I saw him he got his file out that contained loads of photographs and he dropped into the conversation this was his 23rd visit to the site.

 

Since Covid, I have not seen him.  And my email to tell him we have moved out of the caravan and into the house and we now need to delete the caravan from the valuation list and add the house to the valuation list has gone unanswered.  I don't mind still paying band A council tax but feel sure we will get hit with a bill backdated until completion when they eventually wake up.

 

I remember in Jeremy's case the valuation officer viewed the house and although not finished declared it should only take 3 months to finish if from that stage so that is when they will be billing him from.

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17 minutes ago, pocster said:

If you have a ‘feature’ that bco would wince at say for example a dodgy temporary staircase - would that deem it not habitable? . So you live on site but not habitable . Another condition we all need is fire alarms - yet I have none installed . So bco might deem these things as not complete . I’m just concerned as I get the robot from the council out for tax valuation they obviously have to add the property to the list - but I don’t want the word habitable anywhere .

Perhaps get the fire brigade to take a look ? . Fairly certain they will be shocked - they surely could write a short letter stating ‘ dangerous ‘ , ‘ incomplete’ and not fit for habitation perhaps ???

 

And thats a bull's eye son. Go to the top of the class.

 

This is what happened to me: 

 

Lovely lady from Council visits and calls it habitable (occupancy).

She tells the VAT Monster.

After an absence of 18months (refuse to come round) BCO pops round  " - *kin' *ell Ian, you need this this and that, get it done pronto "

Ian: so it's not habitable then?

No, not in this state. Get this that and the other done.  (Two suicide doors and other bits - fire OK)

But until I get my VAT refund back I can't afford it ....

VAT monster asks - DESPITE THE ASKED FOR RELEVANT, ACCURATE EVIDENCE ALREADY SUBMITTED - what did you do between occupancy and the VAT refund application?  Every single dated invoice is there for the Monster to read. 

In other words lining themselves up to deny the VAT reclaimed between occupancy and VAT refund application

 

Put a Notice on your property denying access to one and all without written permission from you. Put time lapse cameras up and make sure you maintain them.( @Jeremy Harris has a blog post / cautionary tale / normal post about it somewhere.

 

And follow @ProDave's advice.

 

 

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23 minutes ago, ToughButterCup said:

 

And thats a bull's eye son. Go to the top of the class.

 

This is what happened to me: 

 

Lovely lady from Council visits and calls it habitable (occupancy).

She tells the VAT Monster.

After an absence of 18months (refuse to come round) BCO pops round  " - *kin' *ell Ian, you need this this and that, get it done pronto "

Ian: so it's not habitable then?

No, not in this state. Get this that and the other done.  (Two suicide doors and other bits - fire OK)

But until I get my VAT refund back I can't afford it ....

VAT monster asks - DESPITE THE ASKED FOR RELEVANT, ACCURATE EVIDENCE ALREADY SUBMITTED - what did you do between occupancy and the VAT refund application?  Every single dated invoice is there for the Monster to read. 

In other words lining themselves up to deny the VAT reclaimed between occupancy and VAT refund application

 

Put a Notice on your property denying access to one and all without written permission from you. Put time lapse cameras up and make sure you maintain them.( @Jeremy Harris has a blog post / cautionary tale / normal post about it somewhere.

 

And follow @ProDave's advice.

 

 

I’m not just a pretty face and body you know !!

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28 minutes ago, ProDave said:

...

I remember in Jeremy's case the valuation officer viewed the house and although not finished declared it should only take 3 months to finish if from that stage so that is when they will be billing him from.

 

Dave, can you find that post? I've tried fror 30 minutes and can't. If you do, could you link to it here. It's relevant to our discussion.

 

Maybe anyone else like to give us a hand.? 

 

Its the one where J  takes the Council to task for inappropriate peeping-tommery (tamsinery).

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25 minutes ago, ToughButterCup said:

 

Dave, can you find that post? I've tried fror 30 minutes and can't. If you do, could you link to it here. It's relevant to our discussion.

 

Maybe anyone else like to give us a hand.? 

 

Its the one where J  takes the Council to task for inappropriate peeping-tommery (tamsinery).

12th post in this thread

Sometimes google does a better job of searching than the forums own search feature.

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HMRC have lost a number of cases at tribunal when they decided that a property was complete using a spurious assessment of when that was likely to be. In some cases it defied all logic and they even contradicted themselves several times. Certainly the legislation appears to point towards the completion certificate as the key document that defines  completion and the legislation  has some provision that allows for people to apply for the reclaim if they wish before the completion certificate is ready, but no one should be forced to apply for the reclaim early if they choose not to.


Clearly it makes no sense to push the boundaries and challenge HMRC to a dual so it also makes sense to leave some key work to complete after the property is occupied and without which the completion certificate can’t be issued. I believe that @jack took this approach by leaving some key work to his balconies to the end and had a record of fairly regular purchases leading up to completion to evidence work still to be done / still being done. So my advice (caveat emptor) would be to ensure that you clearly document work still to be completed post habitation, ensure a steady stream of purchases are entered into the reclaim form up until the completion certificate is issued, take lots of photos with clear dates, and look out for tribunal cases that appear to be turning the tide in HMRC’s favour. Currently the flow has been towards the tribunals siding with self builders. 
 

The other thing to note is that if a case goes to tribunal whatever HMRC have written on the claim form or tell you either verbally or in writing has no bearing once the case hits the tribunal. They are only there to uphold the law which is always based on the legislation. They may heavily criticise HMRC and have done in many cases but it will not change the outcome. 
 

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This is all very disconcerting, I'm gearing up to occupy the house in the near future, but no chance I will have everything done within a 3 month window. Loads in house to do, garage to build...the list goes on. I hope 'occupancy' does not become a recognised trigger.

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13 hours ago, ToughButterCup said:
  • Week after April 21st 2021, nice lady writes to me with a copy of the Entry into Valuation List.
  • Snip
  • July 2021 I submit my VAT claim

 

Was the claim filed within 3 months of you receiving the valuation in April? If so that could help.. 

 

The claim form says your claim must be filed within 3 months or you must explain why it wasn't in a covering letter. 

 

I think I would take a two prong approach in the letter..

 

1)  Provide evidence to support your view of when it was completed and make meet the 3 month rule.

2)  Point out would wern't aware the  "back dated" valuation had been issued until date in April and even though this was before you were complete you managed to file the claim within 3 month of you receiving it.

 

Presumably the valuation officer doesn't have evidence to the contrary?

 

Edited by Temp
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8 hours ago, Temp said:

 

Was the claim filed within 3 months of you receiving the valuation in April? If so that could help.. 

 

 

Yes. 

There are two levels of Valuation Officers. The one in the VOA , and the other at local Council level.

 

I talked to both.

 

The VOA said they automatically send their letter of notification  to both the the local council and the self builder. I never got a letter from the VOA . But the local council copied it to me.  Both letters of notification are generated and sent by the VOA at the same time. Both letters are dated 21st April 2021.

 

That's the date which counts as far as HMRC is concerned ( see earlier post) 

 

I talked to the local  council Valuation Officer. She has more detailed evidence - like when she sent her assessment of occupation to the VOA. She backs up my story.  Both of us  were informed of HMRCs decision on or immediately after 26th April. 

To me  , applying by 7th July is within the guidance given by HMRC.

 

9 hours ago, LA3222 said:

.... I hope 'occupancy' does not become a recognised trigger.

 

I'm sorry to have to tell you that it already is and has been for some time.

 

@newhome, bless her  , has set me off on a reading whirlwind on the matter.  I'm going to try and summarise as much relevant information as I can and post it here. 

 

It's the least I can do to repay all the help I have had from BH members.

 

Citizens ! Come the revolution , we will overcome. 

Give us Liberty to Occupy before Completion or Give us death !

(Apologies to Patrick Henry)

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Well this was a timely heads up @ToughButterCup. I am now in a bit of a pickle with cash flow and working out how best to proceed. If I occupy the house and start the clock there is no chance I can do sufficient work in 3mths to unlock the remaining funds and get the VAT back. Cant build the garage as that is where the caravan sits, so I need to work out how I can do sufficient work to add 70k to the valuers price to unlock my remaining funds but without building the garage?‍♂️.

 

Why the hell are they arbitrarily interpreting the legislation in order to stiff the self builder. Peanuts, go after the big boys, that's where the money is.

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4 hours ago, LA3222 said:

...I am now in a bit of a pickle with cash flow and working out how best to proceed....

 

Thats the difficult decision we had to make.

Never mind how the self-builder gets to cashlessness, many self builders get there in the fervent hope of achieving the opposite : a bit to spare.

But, when after deciding to accept that we're going to have to have a lower VAT reclaim than if we'd submitted a full-on Completion Certificate , to find that HMRC are Hell-bent on trying to apply a hidden trigger for the application process (Occupancy) is more than a little annoying.

 

I have spent several hours reading today: HMRC internal Guidance, BH, @jack, @newhome 's posts, Finance and Tax Tribunal decisions (Category Builders 37, subcategory Do It Yourself, 37.1), and the like , I see it is common for inconsistency to reign.

 

In fact the only thing that is consistent is inconsistency.  @jack blows a fuse about it all over this sub-board.

 

I'm currently reading up on what consitutes occupancy, or rather which aspects of a self build automatically discount the classification

' fit for occupancy' . Hell, thats a mine field too. 

 

Off to go and swim the dogs in the river. 'kin' 'ell am I cross.

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We have been living in it for a year, and had the VOA done when we moved in to keep council of our back. Now nearing completion, hopefully sign off before xmass. Been buying stuff thats claimable throughout as it was a shell when we moved in...

 

VAT stuff is ready to go so will submit straight after BCO sign off, going to use that to get flooring in! I will be very unhappy if they challange this.......

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  • 1 month later...

Hi sorry to Hijack this thread [didn't really know where to post, but this discussion was heading the right direction]

 

We are approaching finishing [I wont use the term completion] our self build house.    We are essentially complete.

 

We need to complete the drive, fencing, garage door, and a few bits of electrical work in integral garage.  

 

I am fending off the council tax lady by saying it is inhabitable and not complete, luckily she does not visit site, and she accepts that the council [albeit the county council] still have not completed my Drop Kerb after their initial visit in April.

 

The building control, want the garage door on [not coming till Feb or some other time, when people stop using COVID as excuse] to offer a completion certificate.

 

Mrs won't let us put our existing house [mostly owned by the Bank) which we are living in  on the market until it is legal to "move into the new house".

 

So my question is who supplies a habittal certificate - BCO or Council Tax People ?

 

The big Hitters left [drive and garage door] will VAT 0% invoiced as they have already said this, so I can prep the VAT Return.

 

I also need to move the Site Insurance over to buildings insurance, so could that be done on the Council Tax Valuation entry

 

Thanks in advance, and sorry for the hijack.

 

 

 

 

 

 

 

   

 

 

 

 

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In Scotland BC will issue a certificate of temporary habitation.  I assume something similar exists in other places?

 

VAT refund can wait until completion if you want, or you can do it with a certificate of temporary habitation.

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2 hours ago, Blooda said:

...

So my question is who supplies a habittal certificate - BCO or Council Tax People ?

...

 

BCO.

 

I symapthise with your other half. The question  of moving and legality is slightly 'wrong Wrong's  not the word I want but its close enough

2 hours ago, Blooda said:

...

Mrs won't let us put our existing house [mostly owned by the Bank) which we are living in  on the market until it is legal to "move into the new house".

...

 

If you have PP, there is nothing - except practicality - to stop you moving in. Our next door neighbour has been living in his Dwelling House (block built structure that the Inspector called '... on the balance of probability a dwelling house...' and it counts for Council Tax  as a house even though it's built INSIDE a perfectly good caravan. I kid you not)  . He has been paying Council Tax for years (4) But very few men and even fewer of the other persuasion would call it a house. He has water, electricity and an illegally sited open cess pit (within honking distance)  as foul drainage. All mod cons then.....

 

So you can tell her, on your  evidence as  presented above, its perfectly legal to live in it today. 

If you look at the VAT form, there are a series of other 'markers' which have the equivalent status to BCO sign off - as far as HMRC are concerned 

 

My suggestion is that you consider the issue in the round, rather than focus on just the VAT refund or just the Council Tax bill or just moving in.  We started paying our Council tax bill in advance (3 or four months) because of the time gap between formal notification from the  (local Council) Valuation Office and  our notification that the property had be listed by the VOA (Valuation Office Agency) (5 months as detailed in an earlier post).

 

Long may your dropped kerb remain on the back of a lorry, and your water locked in a pipe. 

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Thanks for the prompt reply.  I always thought I needed a completion certificate to move in, but thinking about it we lived in the current house with a gaping hole in the side when we did extension ! so the new house is in a better state than that was.

 

So I am now thinking the current plan is - [which history has told us will not be adhered to]

 

1) Tell the wife we can move in

2) Crack as we are on till Christmas.

3) after Christmas tell the Council Tax Lady we are ready for completion.

4) as soon as she sends the notification - Put old house on Market, and finalising the VAT return

5) play the trump card:-  let her know the house is now occupied by our Son [who is a Full time Student], and if she asks Me and Mrs will be moving in when we sell the existing house. Which we will.

6) Son Moves all his addresses to the house. 

7) Me and Mrs move stuff in gradually as we always had planned,

8 ) Move in officially just before completion of old house or sometime to suit us.

9) Sort out Insurance when the site insurance runs out in Feb 

 

 

 

 

 

 

 

 

 

 

 

 

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Just checking -- detail matters here  :

 

Quote

as soon as she sends the notification

 

You mean (she) sends you a copy of the VOA letter ('notification' above) telling you about the Notice of making a New Entry to the Valuation List don't you? 

 

She will take no notice of the date you say you are going to inhabit the house. It makes no difference to her. She will have achieved her aim (if her role extends only the the Council valuation office) ; namely to have added your property to the number of chargeable properties in her area. How much to charge is nothing to do with her office. Its not her role to ask about who is living in the house. Her focus is: is it habitable?

 

We started paying up-front before the valuation was known to avoid a thump of a bill this July. No reason you can't pay a little now..... Tell your son to start saving.?

Edited by ToughButterCup
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slight hi- jack 

 still awaiting planning consent for refurb and alterations etc

-so question is  

when  I put in the vat claim can I claim for goods purchased before planning completion date

 I wish to make all walls capped and secure from further damage  and about pull the trigger on a lorry load of lintels and another pallet of cement and 3 pallets of bricks

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