Ian Cooke FCA

Are you having your new home or holiday home built to specification?  Just as a  builder in business is able to claim back all of his input VAT on building a new residential property, there is a VAT scheme which allows you to achieve parity.


This is called the VAT DIY scheme. There are various rules over what input VAT you  can  and cannot claim and a deadline of 3 months after completion of the property to file your claim. Remember, you and your family  must live or take holidays in the property after completion in order to  claim a refund.

In essence, you are able to reclaim input VAT on building materials that are  incorporated into the building and cannot be removed without tools or damaging the building, in other words the VAT incurred on building the “structure” of the property.

You are unable to obtain a VAT refund for materials or services that do  not have any VAT,  for example the builder’s invoices  (as they will be  zero-rated anyway).  You  also  cannot claim the  input  VAT   on  professional  or  supervisory  fees  such as architects or surveyors or on hiring machinery or equipment. Fitted furniture, electrical and gas appliances, carpets or  garden ornaments also do  not  qualify.

However, depending on the cost  of  the  property being built,  the input VAT at stake can be significant. An  example of  a  claim that we prepared resulted in  a  successful  reclaim  of  over £34,000! HM Revenue & Customs ask to see all of the purchase invoices on which the input VAT  is  being reclaimed, so obtaining these is key as is filing them away neatly in a  file  in  date order.

This is the stage at which we can help, as we  offer to  review the invoices presented and prepare the claim to HM  Revenue  & Customs on the basis of what we know they should accept.  We are able to provide a fixed fee quote based on the number  of hours that we estimate it will take us to complete the claim.

For further details please contact Ian Cooke at our Ledbury office on 01531 631500.