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Where Taxpayers and Advisers Meet

Housebuilders’ Scheme VAT refund

SaraE
Posts:2
Joined:Fri May 28, 2021 3:05 pm
Housebuilders’ Scheme VAT refund

Postby SaraE » Fri May 28, 2021 5:26 pm

We have converted an agricultural building for our son to live in. I have submitted the form with the invoices for a VAT refund. They have written back and they want to know the arrangement for our son residing in the property so that’s fine because he’s got his council tax and broadband bill et cetera. They also ask if I can confirm ownership of the build and if there has been or will be any financial transaction between us and our son for the property such as selling the property or letting.

The arrangement we have with our son is that every month he’s paying us an amount of money which is to just pay back the money we spent out on the construction (excluding the VAT of course if we get it back). We are giving him the agricultural building and the land it stands on so no financial gain. The house is not yet in his name; we are going to draw that up in three or four years time.

Does this sound ok, please?

les35
Posts:614
Joined:Wed Aug 06, 2008 3:09 pm

Re: Housebuilders’ Scheme VAT refund

Postby les35 » Tue Jun 01, 2021 9:00 am

You should be aware that, if HMRC think your son is occupying the house under a lease, even if informal, they will consider it a business, and so deny your claim.

You must make it clear that it is a reimbursement only and is not linked to his right to reside in the house.

SaraE
Posts:2
Joined:Fri May 28, 2021 3:05 pm

Re: Housebuilders’ Scheme VAT refund

Postby SaraE » Tue Jun 01, 2021 9:10 am

Thank you, so ok to say he is purely reimbursing us (which he is). Is it an issue when we transfer it to him, please? We can do this anytime really, just haven’t been to the solicitor yet.

les35
Posts:614
Joined:Wed Aug 06, 2008 3:09 pm

Re: Housebuilders’ Scheme VAT refund

Postby les35 » Wed Jun 02, 2021 11:08 am

The ownership of the property is not a great issue; either you or your son can own it. This should not prejudice the DIY claim.


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