VAT on empty property

[HAIGHY]

Hi. New to renovation but a keen diy er. We are buying a 1930's property that has been empty for over two years. I understand I can claim 5% VAT. However the builder we normally use isnt VAT registered. Can I still claim VAT on the materials and obviously not the labour . Is there a way around this ? Thanks

Edited 17 hours ago by HAIGHY

[Temp]

My understanding..

 

Unfortunately if your builder isn't registered for VAT there isn't a way for you or him to reclaim the VAT paid on materials.

 

Nor to any subcontractors... So if your builder hires a VAT registered subcontractor, like an electrician, the electricians bill and any materials he supplies will be at 20% (to your builder). However if you were to hire the VAT registered electrician directly he can 5% rate everything to you that he supplies. This is because the 5% rule only applies to labor and materials supplied to the "final customer" by the person/company doing the renovation.

 

If it had been empty for 10 years, and the builder was VAT registered, you could also claim the 5% back charged by the builder AND the 20% you paid on any materials using the self build reclaim scheme. Unfortunately I'm pretty certain this doesn't apply to properties only empty for 2 years. 

[nod]

1 hour ago, Temp said:

My understanding..

 

Unfortunately if your builder isn't registered for VAT there isn't a way for you or him to reclaim the VAT paid on materials.

 

Nor to any subcontractors... So if your builder hires a VAT registered subcontractor, like an electrician, the electricians bill and any materials he supplies will be at 20% (to your builder). However if you were to hire the VAT registered electrician directly he can 5% rate everything to you that he supplies. This is because the 5% rule only applies to labor and materials supplied to the "final customer" by the person/company doing the renovation.

 

If it had been empty for 10 years, and the builder was VAT registered, you could also claim the 5% back charged by the builder AND the 20% you paid on any materials using the self build reclaim scheme. Unfortunately I'm pretty certain this doesn't apply to properties only empty for 2 years. 

Until recently when HMRC brought in the end user to apply to vat 

You wouldn’t have been given as clear of an answer as Temps 

 

  👏