VAT Refunds on Building Your Own Home

I am an employed brick layer and I am therefore pretty good when it comes DIY. My girlfriend and I are thinking of building our own house and one of my mates in the trade, said that we might be able to get some tax back. Was there any truth in what he said?

1st October 2011

Yes- there is a DIY Refund Scheme which could mean you could reclaim some of the VAT back on a new build or a conversion of a non-residential property into dwellings which will be used either by you or your
relatives for residential or holiday purposes.

You can claim for building materials, including materials bought in any other member state of the EU. But there are strict rules that they are genuine building materials, and not furniture, electrical/ gas appliances, carpets etc.

You can also reclaim for any builder’s services, although they should be zero-rated anyway. You cannot reclaim VAT paid on any professional services though, like surveyors or architects fees. And you cannot reclaim the VAT paid on any hire of plant and equipment.

You cannot claim before or during construction; you must wait until the building is completed, and your claim must be made to HM Revenue & Customs within three months of completion. The forms to make a claim can be obtained from HM Revenue & Customs’ website.

 You must include various information with your claim:  your calculation of your refund, copy of the planning permission, plans and evidence the building is completed (such as a Council Tax assessment).

If your claim is successful, HM Revenue & Customs estimate you should receive your refund within 30 banking days of them receiving your claim.

If you would like to discuss this further or would like your local TaxAssist Accountant to help you with your claim, please feel free to contact us.

By Jo Nockels

Disclaimer: The information provided is based on current guidance (at date of publication) from HMRC and may be subject to change. Any advice shared here is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this information, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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