Presumably you have looked at this?:

https://www.gov.uk/vat-building-new-home/eligibility

...though I agree a gov't guide may be very different to actual experience!

you can only make the vat reclaim once, at the end of the job when you have something that proves it's finished (like a completion cert, council tax bill etc)

HMRC require the claim to be laid out in a set format and they provide sheets for you to record all the receipts on - best off doing things in their preferred format because it's easier for them than having to think

if youre new building then your suppliers should zero rate their services and supply of goods. If you buy the bricks and get e.g. a brickie to install then his work is at 0% and the bricks are at 20% - you pay the VAT and get it back. I've long considered that an unscrupulous builder could say "1200 inc vat to supply bricks and build a wall" and when you point out it's a new build he changes it to "1200 plus 0% vat to build a wall" - the only mechanism to stop this is you should be ablee to go to another vat registered builder who will say "1000 + vat to build a wall, and the vat is 0%" so the honest guy gets the business

if youre doing a conversion you get charged 5% vat on "services supplied during the course of construction" so if your bricke brings the bricks and builds a wall you pay 5% vat and you cannot reclaim it. this might be one of those situations where you prefer to buy the bricks at 20% vat and have it reclaimable and then pay someone 5% vat to do the laying which is perfectly acceptable

certain services are not allowed to be zero rated, mainly non dirty stuff like architects, planning consultants and other professional services
certain things are not allowed to be reclaimed, like carpets and appliances, even built in ones, apart from AGAs. the rule of thumb is: if it would cause serious damage to the fabric of the building or vital system to remove it, then it's "part of the fabric of the building" and is allowed to be reclaimed

if you want to reclaim your VAT every few months then you'll have to form a limited company to carry out your building work

Posted By: cjard if youre doing a conversion you get charged 5% vat on "services supplied during the course of construction" so if your bricke brings the bricks and builds a wall you pay 5% vat and you cannot reclaim it.

I've only done a new build but I'm pretty sure you can reclaim the 5% VAT paid on a conversion...

http://www.homebuilding.co.uk/advice/existing-homes/renovating/vat

Conversions

Conversions are zero-rated but the rules governing the payment and recovery of VAT are slightly different to those applied to new build. With conversions, labour-only or supply-and-fix contracts attract a reduced VAT rate of 5%.

As with new build, if the self-converter purchases materials on their own account they will have to pay out VAT at the full rate. But then they can recover this, together with the 5% paid out to builders or subcontractors, at the end of the project.

PS If anyone tells you that _their_ particular bit must be 20% come to this forum or the ebuild form for advice.

For example the water co told me that a water main diversion costing about £5k would have to be standard rated. I argued and eventually they agreed that if my house was connected to the new route they could zero rate it.

do you know if HMRC need to see detailed working plans of the whole build? I ask because I have spent aboout 150k on a major renovation of a farmhouse but mostly on a bit by bit basis rather than working to a set of detailed plans. I could retrospectively knock up some plans but that would be quite an effort and I'm not sure what HMRC expect.
On a side note I still have to prove that the building has been unoccupied for 10 years to get full VAT back so that isn't fully sorted yet, but hopefully I can sort that side out.

Sorry - having searched with no luck previously - my post just now motivated me to have another go at Googling, and I found the answer immediately:

VCONST24400 - DIY builders and converters VAT Refund Scheme - eligibility of claims: condition 6: is the claim for eligible goods and/or services?

"Delivery charges

The VAT incurred on delivery charges separately itemised on main invoices for eligible goods are part of the value of the goods for the purposes of the Scheme and can be refunded.

Separate invoices for transport or delivery aren’t eligible for refund."

http://www.hmrc.gov.uk/manuals/vconstmanual/vconst24400.htm#IDAELEWB


Sorry to have troubled everyone!

All v gd detail - thanks

Funny, hmrc were adamant when I phoned them that 5% rated stuff was not able to be reclaimed. I've yet to make my vat reclaim, so I'll phone them again to clarify this

<blockquote><cite>Posted By: jfb</cite>do you know if HMRC need to see detailed working plans of the whole build? I ask because I have spent aboout 150k on a major renovation of a farmhouse but mostly on a bit by bit basis rather than working to a set of detailed plans. I could retrospectively knock up some plans but that would be quite an effort and I'm not sure what HMRC expect. On a side note I still have to prove that the building has been unoccupied for 10 years to get full VAT back so that isn't fully sorted yet, but hopefully I can sort that side out.</blockquote>

If the house has been unoccupied then council tax records are generally the best evidence. There is quite a difference between the rules for a house empty for 2 years and one empty for 10 years. Some details here..

http://www.homebuilding.co.uk/advice/beginners/finance/different-vat-concessions

It's important to note that the house has to be empty for 10 years "before work starts". So if you move in and then start work you fail the test because you occupied it before work started (eg it wasn't empty for all of the 10 years before work started). However you are allowed to start work and then move in. So be very careful what dates you put on the reclaim form.

If you can prove it's been empty 10 years then it's treated like a conversion of a barn or similar. They ask for a copy of your planning permission but if your renovation was covered by Permitted Development Rights you have to explain that at Q14 on page 1 of the reclaim form. The form has a guidance notes at the end.

http://www.hmrc.gov.uk/forms/vat431c.pdf

I don't believe you need to send full plans but I've not done a conversion only a new build. I only sent the drawings from my planning permission.

When renovating, as opposed to change of use or "empty ten years", all works and materials for insulating a domestic building element previously uninsulated/poorly insulated is 5% VAT. Neither architect nor builder knew this! So, having read the official guidance I rang HMRC and took them through the floor/roof/wall build-up step by step. After conversing with "my supervisor" the helpful chap I spoke to agreed that 5% was the correct figure. This included renewing elements that of necessity had to be taken out and replaced or renewed as required such as skirtings/door frames/bathroom fittings where two outside walls were involved. Builder then claimed quarterly being careful to be sure he kept to the agreed formula - all honest and above board. I kept names at HMRC for future reference but there was no comeback. Saved a load of money.

Posted By: cjardcertain services are not allowed to be zero rated, mainly non dirty stuff like architects, planning consultants and other professional services

Correct, but funnily it's almost literally “non-dirty” stuff rather the “certain services”. E.g., AIUI if, for some reason, you get a surveyor in to lay out the site then you have to pay full-rate VAT on their fees and can't reclaim that whereas if the grubby builder does it as part of doing the foundations then they should zero-rate that work.

Posted By: athomsonCan I reclaim the VAT charged on delivery of materials?
…
Sorry to have troubled everyone!

Not at all, I found that useful information to bear in mind.

Has anyone looked at cheating their own "single use" linted company to do their build, and hence have everything done by a vat registered company?

Posted By: ringiHas anyone looked at cheating their own "single use" linted company to do their build, and hence have everything done by a vat registered company?

It's not cheating; a friend of mine had his company do his self build and reclaimed everything along the way. He recommended I do the same, but I wasn't certain that forming a limited company was worth the few thousand it'd save over the entire job.

It is not really in the 'spirit' of things. And I think they are tightening up on these sorts of scams.
may be worth having a chat with a VAT accountant and asking what is the best way to sort it. Separate quotes and invoices where it matters, maybe use a QS to project manage it all.

I am sure if everyone paid the correct tax then the tax level would be lower.

Posted By: SteamyTeaif everyone paid the correct tax then the tax level would be lower

Is taxation not part of the market i.e. as much as the market will stand? If not part of the market, why not? How can the market function in the magical way it's supposed to, if huge chunks of 'the science of human behaviour' works by contrary rules?