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https://www.askthetrades.co.uk/cgi-bin/yabb/YaBB.pl DIY Forum >> Building Questions >> VAT on Water Main diversion https://www.askthetrades.co.uk/cgi-bin/yabb/YaBB.pl?num=1110293617 Message started by CWatters on Mar 8^th, 2005, 2:53pm

Title: VAT on Water Main diversion
Post by CWatters on Mar 8^th, 2005, 2:53pm

I'm waiting for a call back from the VAT man on my first question but meanwhile anyone know the answer to...

I have to get a water main moved before I can build my new house..

a) As a Self Builder (eg Notice 719) should I be paying VAT on the £5000 Anglia Water want to move it?

b) They don't have a wayleave so should I be paying AW anything at all?

Thanks,

Colin

Title: Re: VAT on Water Main diversion
Post by CWatters on Mar 9^th, 2005, 6:03pm

Well the nice man at Customs and Excise did indeed call me back to tell me that yes the watermain diversion should be zero rated.

Yippiee that's around £1000 saved.

Title: Re: VAT on Water Main diversion
Post by Robbo on Mar 9^th, 2005, 11:09pm

Think I am correct in saying that you can claim back on all vat paid on a self build :D
Built mine last year, no such provision in Ireland :'(

Title: Re: VAT on Water Main diversion
Post by JerryD on Mar 9^th, 2005, 11:44pm

wrote on Mar 9^th, 2005, 11:09pm:

Think I am correct in saying that you can claim back on all vat paid on a self build :D
Built mine last year, no such provision in Ireland :'(

When I built my house in the 80's the vat position was you could only make ONE vat reclaim for the whole project.

So I had to keep all my vat receipts and make one giant reclaim at the end of the build. The trouble is that you never really 'finish the build' and are continuously still buying bits and pieces for ages afterwards, so you can't reclaim any vat on these later purchases.

You have to make the decision when to make the reclaim - it's a balance between getting a large chunk of vat repaid now or hanging on until all the odds 'n sods are bought and then doing the bigger (but later) reclaim.

Of course, all the while the project is going on you are financing the vat you have paid but can't yet reclaim :(

Title: Re: VAT on Water Main diversion
Post by Robbo on Mar 10^th, 2005, 12:30am

Know exactly what you mean Jerry, we moved last september but it is only now the nights are getting longer that I am getting around to building the shed/workshop......... patio......boundary walls.......footpaths........kerbing.........landscaping, and thats without all the bits and pieces inside, skirtings, arcs, painting, varnishing, door hanging bla bla bla bla bla. But I am so lucky.. I dont have that worry of when to claim back a huge stash of vat. :-/

Title: Re: VAT on Water Main diversion
Post by CWatters on Mar 10^th, 2005, 5:57pm

wrote on Mar 9^th, 2005, 11:09pm:

Think I am correct in saying that you can claim back on all vat paid on a self build :D
Built mine last year, no such provision in Ireland :'(

It's not quite that simple. You _can_ claim back VAT paid on materials and fixtures but labor (eg Bricklayers) must zero rate. You cannot claim back VAT paid on labor in error. That's the reason why I was so keen to get it right up front. The problem is not all "labor" is zero rated - professional services (eg Structural Engineers) must charge you VAT and you can't reclaim it after.

"Notice 719" is actually a free guide to VAT on selfbuild.

Title: Re: VAT on Water Main diversion
Post by chappers on Apr 2^nd, 2005, 8:52am

there is also a time limit after the build is signed off for you VAT reclaim, six months I think so better to hold off getting your final inspection until you have everything done.
Did a timberframed house for a customer a few years back and they were doing a self build and VAT reclaim, but as they wanted me to supply most of the materials, it meant I charged them at zero rate VAT and still could claim back the VAT on the purchases, Not very often yopu get arebate from C & I for 12K must have touched a raw nerve as I got a partial investigation the next year, even after telling them what was happening before the event.Bastards !!!! mind you they have left me alone since.

Title: Re: VAT on Water Main diversion
Post by JerryD on Apr 2^nd, 2005, 9:34am

wrote on Apr 2^nd, 2005, 8:52am:

Not very often yopu get arebate from C & I for 12K must have touched a raw nerve as I got a partial investigation the next year, even after telling them what was happening before the event.Bastards !!!! mind you they have left me alone since.

I know what you mean. My quarterly vat returns always include a cheque payable to C&E as I always collect more vat than I spend.

However a couple of years ago I did loads of work on Grade 2 Listed Buildings so I was not collecting vat. The quarterly vat return requested a reclaim of a few grand. :o

I was worried this would trigger a full investigation but luckily nothing was said :D

My view of C&E is that as long as you keep doing much the same, quarter after quarter, then they leave you alone.

Title: Re: VAT on Water Main diversion
Post by CWatters on Apr 3^rd, 2005, 4:25pm

wrote on Apr 2^nd, 2005, 8:52am:

there is also a time limit after the build is signed off for you VAT reclaim, six months I think

Possibly only three months but I haven't checked.

A few extra tit bits for other readers:

It seems you can only claim VAT on the watermain diversion if your new house connects to the diverted bit. Might be worth moving your connection point even if that costs more just to save the VAT on the diversion!

You can still make a claim even if you are using a builder to do most of the work on your house. eg You can claim back VAT on any client supply items you buy for the builder. Just provided that overall the work you are doing qualifies.

You can claim back VAT paid on items purchased in Europe. For example if you nip over the channel and buy some nice floor tiles or bath fittings in Belgium you can claim back VAT/BTW at the BELGIAN rate of 21.5%.

Customs and Excise have a nice booklet that explains all the details. They even go to self build shows.