How VATExchange Can Help

What we can do at VATExchange is to help you deal with VAT and property issues in a number of ways:

• By listing the publications available on the HMRC website and summarising which subjects they cover so that you know where to start looking. We also list a few professional publications for additional reference.
• In the Property Forum where you can ask for more help. Whilst we can’t give tailored advice on specific transactions, we’ll help you to understand the main principles involved and where to look for detailed information on the HMRC website.
• If you need formal advice on a specific issue, you can contact us using the contact form at the top of the page.

HMRC Guidance

There are some very useful HMRC guides about VAT and property issues which we’ve listed below. The publications are very useful, for a number of reasons. First, they are very good summaries of the rules on their particular subject – for example the option to tax – which means that most of the information can be found in one place. Second, they explain HMRC’s approach to the subject concerned. And third, they also provide helpful practical information such as explaining any concessions or how documentation should be completed.

The publications contain a lot of VAT terminology and are therefore sometimes difficult to read for the non-specialist, especially the longer notices (708, 742 and 742a). But accountants and solicitors and those in the property sector should be able to navigate their way round and find answers for most routine queries.

We’ve listed the main ones below with a little detail on their content.

• VAT Notice 708: VAT and Construction. As the title says, this notice deals with anything¬ related to the construction industry. In particular it explains how the VAT zero-rate and the reduced rate of VAT apply to certain non-commercial building work such as dwellings; when the sale of new non-commercial buildings by the “person constructing” can be zero-rated; and also includes information about the use of certificates for certain construction works.
• VAT Notice 708/6: Energy Saving Materials. This notice explains when the supply and installation of certain energy saving materials in non-commercial buildings can benefit from the reduced rate of VAT.
• VAT Notice 742: VAT and Property. This is another very important notice and explains about the VAT liability of different types of supply of different types of properties. It covers everything from leases and licences to car parks and fishing licences. It explains which transactions of both commercial and non-commercial property can be exempt and which are liable to VAT.
• VAT Notice 742/3: Scottish Land Law Terms. As Scottish land law differs from the rest of the UK, this is an essential notice if you are involved with any transaction where the property is located north of the border.
• VAT Notice 742a: Opting to Tax Land and Buildings. This is an essential reference book for anyone who is involved in any transactions in commercial property, which is more or less anything apart from dwellings and certain residential and charitable buildings. Recently rewritten by HMRC, it is, in our opinion, one of their best publications, albeit already a little out of date! But it explains everything from how and when to make the option to tax, revoking existing options, which forms to use and details of the complex anti-avoidance rules.

Also keep an eye out on the HMRC newspage for announcements about developments in VAT and property issues, which are usually announced in one of their Revenue & Customs Briefs.

Other Publications

There are a handful of very good detailed text books on the subject, written by highly experienced VAT authors. They are quite heavy reading but if you are involved in property transactions on a regular basis and have a good knowledge of VAT (perhaps you are a commercial property solicitor) it is probably worth investing in one or more of them. It is important to have up to date editions to ensure that they incorporate changes to VAT law and case law developments.

These include the following:

• “VAT and Property” by Jim Pinder. This is a looseleaf publication with sections on all the main property issues from construction to development. There are regular updates to the publication and it currently sells at £191 from LexisNexis here http://tinyurl.com/n972ek.
• Tolley’s tax guides. These are around £100 each and new editions are published each year to keep up to date with new legislation. They are excellent technical guides and each contains detailed sections about VAT and property. The most well-known are Tolley’s VAT; Tolley’ Property Tax Planning and Tolley’ s VAT Planning. The other very useful publication is Tolley’s VAT Cases which contains a full summary of V AT case law including those relating to property and construction.

These can all be found on the LexisNexis website here http://www.lexisnexis.co.uk. You can also find them on places such as http://www.amazon.co.uk with a bit of a discount or second hand copies which are a year or two out of date, but still worth having for general guidance on the subject.

We’ll add information on further publications as we go along.