Monday, 21 December 2015

Building a new home #newbuild #VAT

My in-laws have had the opportunity to build their very own home, from start to finish! It may have taken them some years to get to the finished product but they are slowly honing in on the end product (don’t get me wrong they aren't living in a shell, they just have a few odd jobs to get fixed)

Costs can be great when starting out with a new build project, purchasing the land, architects, builders and then the materials!

You can get quite easily bogged down with the never ending bills that you may forget to take a reprieve and remember what you are doing it all for. We love going to their house especially around this time of year, they have a lovely log burner and the rooms are full of furnishings, unlike ours which is still is the mists as to when we will get anywhere need close to finishing!

So being the ever so good son in-law I have taken on the burden of producing their VAT reclaim, when you are building a new property for your own/holiday use the government reward you, like they would to a builder. You shouldn’t pay any VAT on materials used for a new build (you can get allowances for conversions but there are strict guidelines to follow), basically you have 30 days from the date you house is signed off as complete to submit your VAT reclaim to HMRC.

To make sure the process goes well, ensure all the invoices are filled, dated, fully itemised (no whole jobs bills) so you can exclude the labour VAT charges. Remember all invoices need to be address to you (or you need to document why) and have a valid VAT number on.

So I am currently running through all the invoices dating back to the time they first broke ground on the project, you have to list each invoice with date, number, VAT amount and description. It’s quite a tedious task but when you are talking between 15 – 20% refund on all the building materials it adds up to a pretty sum!

There are some exclusion’s to the claim process, you cannot claim for labour, equipment hire and carpets, but as the claim forms come with a half decent guide it doesn’t take long to get the hang of the do and don’ts.

So if you are currently thinking about building yourself a new home, then remember you will need to account for the VAT for some time until the house is signed off until you get you money back!

1 comment:

  1. I do not know what the costs were when building a new house! It seems to me that it is very expensive