VAT on serviced apartments

by **Sunny2010** on Tue Sep 27, 2011 11:15 am

I am currently converting my hotel into residential serviced apartments by putting kitcehnettes in the rooms, the tenants are on assured shorthold tenancies and stay from a week up to an indefinite period whereas before as a hotel they were on a guest registartion nightly structure. My accountant has advised i astill need to pay VAT but I disagree as I am now running a offering residential accommodation all be it for short periods. Does the rent attract VAT?

I am aware there is a formula for a hotel guest staying more than 28 days but this does not apply as the customer is a tenant in a residential apartment (not a hotel guest), the only service we provide now is cleaning once a week, there is no restaurant etc

by **section 44** on Tue Sep 27, 2011 11:24 am

Sunny2010 wrote:indefinite period

Does the planning permission allow persons to reside at the dwelling, as their permanent home?

by **Kitty Kat** on Tue Sep 27, 2011 12:51 pm

Schedule 9 standard rates:

the provision in an hotel, inn, boarding house or similar establishment of sleeping accommodation or of accommodation in rooms which are provided in conjunction with sleeping accommodation or for the purpose of a supply of catering;

(9) “Similar establishment” includes premises in which there is provided furnished sleeping accommodation, whether with or without the provision of board or facilities for the preparation of food, which are used by or held out as being suitable for use by visitors or travellers.

I always assumed a place like 'Roomzzz' which is a serviced appartment in Leeds, would be caught by being 'suitable or held out as for visitors/travellers'. Surely the offer of one night rates (whether or not they are taken up or whether the guest stays forever) would mean they were held out as suitable for visitors/travellers.

But that is purely my interpretation of the legislation, as I say it just seems logical to me, but I can't back it up with real world experience.