VAT on new build properties

Last activity 10 August 2023 by Toon

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MacGeorge8035Serial expat09 August 2023 07:28:47

351

We are buying a new build property and we are paying VAT at 5% on that property. During the build process we are having additional work done. For example we are having additional windows installed, more electrics, better sanitary ware, pool, additional kitchen cupboards and an island. These are all charged as “extras” but I am confused about what level of VAT we should be paying. Should VAT on the “extras” be charged at 5% or 19% VAT.

In the UK new builds are VAT free. When we bought a new build some years ago we did not pay VAT on any extras provided they were done during the initial build stage.

ToonCyprus Expert09 August 2023 09:36:26

9880

I would think that the builder will be paying vat @19% on the extras and reclaiming the vat .. so am guessing 19% will be payable..... Maybe if the property was complete and sold with fixtures and fittings 5% might have been the rate for the total purchase price ...but am doubtful about that scenario.....

MacGeorge8035Serial expat09 August 2023 10:13:42

351

@Toon Thanks, I have asked the builder the same question. They could not answer the question, the sales person said 5% the post sales people say 19%. I am just going to assume 19% and if I am wrong it will be a nice surprise.

ToonCyprus Expert09 August 2023 10:47:12

9880

That's the way I would think too ... Plan for the worst hope for the best.... Good luck

ToonCyprus Expert10 August 2023 04:56:21

9880

@MacGeorge8035 You may be able to apply to the tax department to include these additional costs in 5% tax relief. Maybe not everything will be accepted (I am told that they usually reject AC) but it’s worth a punt ...

Just need to be aware that if the fittings would take the value of the house over the limit they may be charged separately, but this would be pretty unusual.

What's the worst they can do ...?

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