VAT: Buildings and construction
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In certain conditions building and construction work can be charged at zero or reduced rate VAT. This Factsheet aims to highlight some of the conditions when this this could apply.
Zero Rated
You may be able to zero rate your supply if you are involved in constructing a ‘qualifying building’.
A qualifying building can be:
The adaptation of a dwelling for a person with disabilities can also be zero rated. Such building works could include:
Reduced Rate (5%)
The installation of certain energy saving products in dwellings and relevant residential property (but not charitable) is reduced rate. These include:
If your customer is over 60 you can charge reduced rate on certain mobility aids. These include:
If you carry out work to an existing building you will normally have to charge VAT at the standard rate. However, you may be able to charge reduced rate VAT if you are converting premises into a dwelling or premises intended for use solely for a ‘relevant residential purpose’.
This is not intended to be a complete list of when building and construction work can be zero or reduced rate for VAT and the guidance on this subject is much more detailed than this page could ever cover. If you think this can apply to your business please book a chat about your business here.
Zero Rated
You may be able to zero rate your supply if you are involved in constructing a ‘qualifying building’.
A qualifying building can be:
- a building ‘designed as a dwelling’
- a building that will be used solely for a ‘relevant residential purpose’
- a building that will be used solely for a ‘relevant charitable purpose’
The adaptation of a dwelling for a person with disabilities can also be zero rated. Such building works could include:
- ramps, widening doorways and passages
- bathrooms, washrooms and lavatories
- lifts
Reduced Rate (5%)
The installation of certain energy saving products in dwellings and relevant residential property (but not charitable) is reduced rate. These include:
- insulation
- solar panels
- wind and water turbines
- wood-fuelled boilers
If your customer is over 60 you can charge reduced rate on certain mobility aids. These include:
- grab rails
- ramps
- stair lifts
- bath lifts
- built-in shower seats or showers containing built-in shower seats
- walk-in baths with sealable doors
If you carry out work to an existing building you will normally have to charge VAT at the standard rate. However, you may be able to charge reduced rate VAT if you are converting premises into a dwelling or premises intended for use solely for a ‘relevant residential purpose’.
This is not intended to be a complete list of when building and construction work can be zero or reduced rate for VAT and the guidance on this subject is much more detailed than this page could ever cover. If you think this can apply to your business please book a chat about your business here.