Retrospective PP for change to new build

[Bestsy Bungalow]

I'm looking for some advice please. We have PP to convert our 1950s bungalow to a 2 storey dormer window house. The only conditions attached are regarding use of materials. Some walls were going to be knocked down and the rest were going to be reused. The work has started and the builder has discovered that most of the walls that were due to stay aren't able to - two major structural walls that were assumed to have foundations (they were internal and run across the entire width) are built on slab, another pretty much fell down and another was found to have 2.5 inch foundations. Building Control have been over several times and seen this walls.

 

It has become quickly apparent that it's not worth saving and should have been a new build project from the start. Rather than knock another wall down that needs new foundations we would like to knock it all down and start again and save the 20% VAT. We would build exactly the same house on exactly the same footprint. 

 

I have spoken to the council about planning but they aren't very helpful. I have been advised by a property developer acquaintance that retrospective planning is what I need but the council said I would need to submit a full application - I don't think the planning officer listened to me properly though and wanted me off the phone. They don't really like advising over the phone is the impression I get and they just want forms in. 

 

I can't really see why I need to submit a new full application for the same house. I would be submitting exactly the same plans. We are having to knock the walls down as they aren't sound and Building Control have seen this and advised this themselves. The builder needs to carry on with the job and I have lost of a lot of money on this project already so I can't afford any delay. If I did retrospective for knocking down more walls and it wasn't granted they could just force me to rebuild the walls which is exactly what I am doing anyway. 

 

Does anyone have any idea what I should do in this situation?

[Big Jimbo]

In my opinion you will have to apply for full planning permission. A house near me, Young couple and wife pregnant had exactly the same. They wanted to just carry on. Building Control told the planning dept and a stop notice was issued. They had to go back in for full planning, new application. They had no problem getting it, but had to wait the 8 weeks for the council to determine the application.

[Ferdinand]

What was the date on your original PP decision notice?

 

1) Under some circs you get the right to a "Second Go" at little cost. The main thing is iirc you lose a lot of free options after 12 months.

 

This is the place to look, under "Exemptions":

 

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/574500/When_are_applications_eligible_for_a__free_go_.pdf

https://www.gov.uk/guidance/fees-for-planning-applications

 

If your PP decision date is within say the last 10 or 11 months, then look at this NOW (not tomorrow - today), as you could lose a lot of value in fee-avoidance. If you are at 50 or 51 weeks since your Decision Date, then you can do it if you get your skates on.

 

If you are over 12 months then it is a little less urgent.

 

2) Or you could see if you can go for a thing called a Variation to your existing PP, which may be a Material Variation or a Non-Material Variation, depending on the impact of your proposed change on the evaluation of the development from a Planning Viewpoint (mainly, does it look different, or impact on third parties differently). Simply repairing a wall differently may be arguable to be Building Control matter.

 

Some consultancy may be useful in either case, as there are intricate arguments which could be made. eg A new PP needs to start from where you are now, or conceivably they could argue that development have started, and that therefore you have no CiL Exemption if that applies).

 

(I think I am right here, but others may comment usefully).

 

Take care not to lose any other rights if you are in a rush.

 

"Praise the Lord ... and pass the ammunition." (*)

 

Ferdinand

 

* I love the 'planning' line from the song ... "We stand between the Deep Sea and Perdition" ?

 

Edited April 12, 2019 by Ferdinand

[Bestsy Bungalow]

Thanks for the replies. PP was given in February so very recently - we have already used a free second go as we had planning for a larger house but the build costs were too high so we redesigned a smaller house. 

 

There's no variation as the house will not differ at all from the plans we have submitted. 

 

 

[Carrerahill]

1 hour ago, Bestsy Bungalow said:

I'm looking for some advice please. We have PP to convert our 1950s bungalow to a 2 storey dormer window house. The only conditions attached are regarding use of materials. Some walls were going to be knocked down and the rest were going to be reused. The work has started and the builder has discovered that most of the walls that were due to stay aren't able to - two major structural walls that were assumed to have foundations (they were internal and run across the entire width) are built on slab, another pretty much fell down and another was found to have 2.5 inch foundations. Building Control have been over several times and seen this walls.

 

It has become quickly apparent that it's not worth saving and should have been a new build project from the start. Rather than knock another wall down that needs new foundations we would like to knock it all down and start again and save the 20% VAT. We would build exactly the same house on exactly the same footprint. 

 

I have spoken to the council about planning but they aren't very helpful. I have been advised by a property developer acquaintance that retrospective planning is what I need but the council said I would need to submit a full application - I don't think the planning officer listened to me properly though and wanted me off the phone. They don't really like advising over the phone is the impression I get and they just want forms in. 

 

I can't really see why I need to submit a new full application for the same house. I would be submitting exactly the same plans. We are having to knock the walls down as they aren't sound and Building Control have seen this and advised this themselves. The builder needs to carry on with the job and I have lost of a lot of money on this project already so I can't afford any delay. If I did retrospective for knocking down more walls and it wasn't granted they could just force me to rebuild the walls which is exactly what I am doing anyway. 

 

Does anyone have any idea what I should do in this situation?

 

Are you going to build it identical to what was there before? If so then take it down rebuild it as "restoration works". I would not even tell planning, in fact, they would be hard pushed to tell the difference between a fully renovated original and your new build by the time it is finished in all reality.

 

Only person who will want to be involved is BC - but they have been so your sorted there, do BC know the state of the old walls and appreciate that you are making good on shoddy building?

[Bestsy Bungalow]

We are going to build it identical to the approved plans - not what was there before. We would need to tell planning to register it as a new build and get the VAT off though as we need proof of planning permission for it - the current planning permission is not a full demolition then rebuild. 

 

BC know the state of the walls and have advised they should come down. Although that doesn't apply to all of them - there are roughly three remaining that are probably viable. 

[ADLIan]

Also remember that the energy conservation standard under Appr Doc L1A (assuming England) for new build is much onerous that Appr Doc L1B for extension/conversion works. Check carefully with BCO exactly what they require.

[Carrerahill]

15 minutes ago, Bestsy Bungalow said:

We are going to build it identical to the approved plans - not what was there before. We would need to tell planning to register it as a new build and get the VAT off though as we need proof of planning permission for it - the current planning permission is not a full demolition then rebuild. 

 

BC know the state of the walls and have advised they should come down. Although that doesn't apply to all of them - there are roughly three remaining that are probably viable. 

Yes I get that but the original parts are you going to build the same? So in doing your "new build" you end up with your "old" house in a modified state? So anything you need to knock down and simply rebuild will be like for like and the new bits will be new and as per planning?

 

If it was me, I would just do it, but that is me, PP are not going to tell you to take it down, they might just get upset, act daft, they would give you retrospective or say, OK in the interests of taking down a a dangerous building we will leave you alone - if I was in a very compliant mood I would speak to my BC guy and say, look, whats the deal here, can be just pull this all down and rebuild, PP won't care will they? Act daft.

Edited April 12, 2019 by Carrerahill

[Carrerahill]

13 minutes ago, Bestsy Bungalow said:

We are going to build it identical to the approved plans - not what was there before. We would need to tell planning to register it as a new build and get the VAT off though as we need proof of planning permission for it - the current planning permission is not a full demolition then rebuild. 

 

BC know the state of the walls and have advised they should come down. Although that doesn't apply to all of them - there are roughly three remaining that are probably viable. 

 

OK - I've had another think - you would probably be better keeping it as a renovation/modification rather than a new build. So, I would demo all the bad stuff and if that means that you end up with 2 walls of the original house and nothing much else then so be it, your then doing a renovation with modifications and extensions, and not a new build.

 

Also, you could probably leave very little of the old walls, a nod to the original building sort of thing.

 

 

 

 

Edited April 12, 2019 by Carrerahill

[Bestsy Bungalow]

I want to do a new build though to get the VAT off. 

[Carrerahill]

2 minutes ago, Bestsy Bungalow said:

I want to do a new build though to get the VAT off. 

Do you have you planning officers name? Can you meet with them at their office? 

Edited April 12, 2019 by Carrerahill

[Jeremy Harris]

2 hours ago, Bestsy Bungalow said:

I want to do a new build though to get the VAT off. 

 

This is a good idea, but needs some thought.  In order to be able to claim back the VAT you will have to submit the planning drawings and decision notice to HMRC, and they will not refund VAT if the planning consent is for a rebuild, rather than a new build, so that means you will have to get the planning consent changed.

[Bestsy Bungalow]

The builder will invoice us without VAT as he is registered with the relevant agency to do new builds. His proof is a dated photo of it flattened. Therefore we don’t need to submit anything to HMRC although we still need PP as a new build. 

 

I’ve spoken at length with the planning officer who maintains we need another full application as it is no longer a renovation but a new build. As we can’t afford to hold off the builders until PP decision is made we are going to have to proceed while it’s in process. It’s a calculated risk as we already have PP for the same finished house as we’ll be building. 

 

Thanks everyone. 

[Temp]

It's very common for planners to treat a conversion differently to a knock down and rebuild. In some cases planners have agreed a "conversion" but refused or tried to refuse a later application to knock down and rebuild. This sometimes happens if the house is in the countryside where a new house wouldn't be allowed today. In some cases owners have had to take it to appeal.

 

If this sounds like your plot I wouldn't knock any more walks down until you get approval for the knock down and rebuild. Eg preserve the possibility that the existing grant can be implemented even if at some cost/complexity.

[newhome]

You might want to have a read of this case. This relates to a self builder putting a claim in for a VAT refund rather than a zero rated developer built house but it’s worth a read. 

 

http://financeandtax.decisions.tribunals.gov.uk/judgmentfiles/j9302/TC05323.pdf

 

Your builder may need to evidence that the property is a new build and he will need more than photo evidence. You run the risk that without the proper planning permission in place HMRC will reject the zero rating and the builder will want to recover it from you. VAT registered traders have to do quarterly returns so it won’t be long before your house will be on HMRC’s radar. 

 

When you say that your builder will be doing everything you mean buying and fitting the whole lot? You can claim the vat back yourself on eligible items you purchase even if the majority of the work is zero rated by the builder.  

[Bestsy Bungalow]

Thanks everyone. If we knock it all down and do a new build to get the zero rated VAT we will need to do retrospective PP for a new build as we can't afford to stop work until PP comes through. There is a risk with that as we may not get PP although the risk is very small - it's a residential street with lots of different types of houses on it and we would be building exactly the same house as we have PP for but just doing it as a new build. I don't think the council would have much chance in an appeal with that. 

 

However, there are additional costs with a new build so I think it will end up costing us the same, if not more. Also, as work has already started we have already paid VAT for a considerable amount of the work which will be unrecoverable and until we have PP for a new build (at least 8 weeks) any work carried out could be deemed by the HMRC to have happened before it was lawful. Even if the builder doesn't charge us VAT, if the HMRC come after him, he will come after us for it, which we can't risk.

 

I think we'll keep a couple of walls and not do the new build. 

 

 

[newhome]

Also if you demolish and do a new build you will be obliged to meet current building regs in respect of the foundations / insulation levels in the floor / slab. Not sure if you were planning on bringing the insulation level up to current standards (assuming it doesn’t meet those already). 

[oldkettle]

I hope somebody can confirm whether there is another potential pitfall: council tax. My understanding is whereas extension means the band stays the same until the house is sold, new build will cause immediate valuation and likely a higher band. 

[Temp]

Beware.... HMRC are likely to only accept VAT receipts from the date the retrospective planning permission is granted, nothing before. 

 

I recall a case where someone got PP to convert their double garage to a fully self contained granny annex. The council applied a condition that it could not be sold separately from the main house. This meant it did not qualify for the vat reclaim as it wasn't a new dwelling. Half way through the build they got the condition removed meaning it was a new dwelling for VAT purposes. HMRC argued that only VAT receipts dated after the planning condition was removed could be reclaimed. 

 

Your situation seem to be similar. It would not be eligible for the VAT reclaim scheme until you get PP to knock down and rebuild.

 

Edit: Actually I can't remember if they were converting a garage or building an extension but the point is the eligibility changed during the build.

Edited April 14, 2019 by Temp

[Ferdinand]

1 hour ago, oldkettle said:

I hope somebody can confirm whether there is another potential pitfall: council tax. My understanding is whereas extension means the band stays the same until the house is sold, new build will cause immediate valuation and likely a higher band. 

 

The VOA can reband your property If they assess i5 as having changed; but you can Appeal or apply for a reduction.

 

it would surprise me if they are not automatically informed of PPs and sign-offs.

 

On the govt website you can check the values of properties, and the best way to estimate what might happen is to look at the numbers for properties near you similar in size to your finished project.

 

Be warned slightly: if someone complains of being too high they have been known to increase the rest rather than cut that one.

 

F

 

 

Edited April 14, 2019 by Ferdinand

[oldkettle]

47 minutes ago, Ferdinand said:

 

The VOA can reband your property If they assess i5 as having changed; but you can Appeal or apply for a reduction.

I can see on the Council website the neighbours' houses are marked for a review, although they haven't changed anything for well over five years. 

 

Ah, here it is 

https://www.gov.uk/guidance/council-tax-band-changes

"A property that’s increased in size may move to a higher band when it’s next purchased." 

But I am not qualified to discuss the meaning of the word "may". ?

[Ferdinand]

4 hours ago, oldkettle said:

I can see on the Council website the neighbours' houses are marked for a review, although they haven't changed anything for well over five years. 

 

Ah, here it is 

https://www.gov.uk/guidance/council-tax-band-changes

"A property that’s increased in size may move to a higher band when it’s next purchased." 

But I am not qualified to discuss the meaning of the word "may". ?

 

The whole thing, which I think may give them wriggle room .. depends on whether the para you quote is in series or parallel with the rest:

 

Quote

Council Tax bands are set according to the value the property would have sold for on 1 April 1991 in England and 1 April 2003 in Wales.

Alterations to your property

Your property may be moved to a higher or lower band because its size or internal structure has been altered. Your property may have been:

 

• increased in size
• decreased in size, such as partly demolished
• changed in some other way, for example divided into flats or smaller self-contained units, or converted into a single property

 

A property that’s increased in size may move to a higher band when it’s next purchased.

 

Either way for Plan A you keep quiet until something happens.

 

ferdinand

Edited April 15, 2019 by Ferdinand