VAT DIY Housebuilders Scheme: Deadline to be extended

Are you building a new home in which you will live?

Perhaps converting an existing building into a home?

You may be able to get the VAT back – you don’t even need to be VAT registered!

When you purchase a brand new house from a property developer you will not be charged VAT. To aid DIY house builders, HMRC allow you to reclaim VAT on certain building costs. The scheme is intended to put the DIY house builder in a similar position to a person who buys a zero-rated house built by a property developer.

As with all HMRC schemes, there are conditions. Here are just a few of the main conditions:

• You or a relative must live in the home once it is built for residential or holiday purposes

• You must have planning permission and you must submit evidence of this with your claim

• You must supply HMRC with ALL of the original invoices to support your claim

• You can only claim once and you must claim within three months of the work being completed. Claim too early, you may miss out on recovering some of the VAT. We can help you choose the right form and we can help you complete the form.

Here are some examples of what you can’t claim for:

• Services – eg architect & surveyors fees

• Planning fees, consultancy & design fees

• Hire of tools and plant

The government are going to legislate to digitise the DIY Housebuilders’ scheme and will also extend the time limit for making claims from 3 to 6 months.

Note that the time limit at the moment remains 3 months (from when the building work is completed) but we will update you when we have further details of the extension to 6 months.

Do talk to us before you start the project – it could save you money in the long term.

Contact us today

Disclaimer - All information in this post was correct at time of writing.