doobin
Well-known member
What's the score on this? Bloke is doing a new build and wants a digger and driver for two weeks for landcaping. Can we zero rate?
Regy53
I like cake
I wouldnt think you could. Isnt it for materials etc only?
GazCro
Well-known member
I would zero rate and actually am on a job now. Accountant says it's ok. I believe it's a bit of a grey area but they let it go. End of the day customer would claim vat back at end of job anyway
D
Diggerdavey
Well-known member
I’m doing a new build at the moment and as I understand if VAT is applied to labour this cannot be claimed back at the end. I may be wrong but I understood the reclaim process is for materials only
D
DaveDCB
Well-known member
No you can’t zero or 5% vat on plant hire for new builds, they cannot claim it back and as such you cannot zero it. I believe scaffolding is the same. Hmrc have a comprehensive document on self build/barn conversion vat rates and they follow it to the letter when processing claims!
(trust me I have done afew of them, they miss nothing!!)
(trust me I have done afew of them, they miss nothing!!)
F
fred
Well-known member
if he is a self build no, he has to claim it all at end. if its a builder and he is stopping you CIS then no again at least for us, builders are on monthly vat anyway so it really doesnt matter.
D
DaveDCB
Well-known member
Read the last few pages
Also a version for new build
Also a version for new build
TiltyShaun
Well-known member
For what it is worth, digger and labour zero rate, digger hire without driver standard rate.
D
DaveDCB
Well-known member
So it seems, what doesn’t help is hmrc is very much personal opinion based unless proven otherwise! Ie depends who is inspecting you or on the other end of the phone!
GazCro
Well-known member
When i make out a zero rated invoice for a new build i don't put it down just as hire of machine and operator. I put down "excavation works for foundations of new dwelling" for example. This allows me to zero rate and is accepted. I think if i was to charge vat the customer may not be able to claim it back later. This is the grey area i referred to earlier.
CPS
Well-known member
I'm building a house at the minute. Put the concrete in the sub floor last Saturday... the concrete co.hasn't Invoiced me ... will I, or should I be charged VAT
Danny
Well-known member
Same as i do.
I would invoice landscaping works to plot 1 - planning number on invoice zero rated for new build
JD450A
Feral as Fk 🐾
We put down "plant contracting works for new build house" and then itemise it: Some kit will have a operator with it, others will be the machine on it's own. but overall the job is including labour.
Gunners
Well-known member
^^^^^ This^^^^^^ You are meant to keep a record of the planning number so it would in theory be traceable if HMRC investigated you a few years down the line. Putting it on the invoice as someone said above is a good idea and one that I will do from now on as thats a neat way to keep all the info in one place.
I hate doing 0% vat stuff as its me suffering the cash flow, then they deduct CIS off you and you have f**k all left at the end until you can claim it back. But thats why I retired from that game!
doobin
Well-known member
Clear as mud then!!
thanks guys
thanks guys
B
Brendan
Well-known member
I'm on the flare rate scheme so I give new builds a swerve as can't zero the vat, unless I take a 10% hit
C
CWatters
New member
Some of the info posted previously is wrong. Here is a summary from a self builder that has been through the Self Build VAT reclaim process for a new build.
1) Self Builders can reclaim the VAT they have paid on materials. They cannot reclaim the VAT that trades have purchased for them see 3).
2) Labor must be zero rated to the self builder. They cannot reclaim VAT incorrectly paid on labor..
3) In the case of "Supply and fit" on the same invoice BOTH must be zero rated to the self builder. A typical example would be an electrician or plasterer. If you are a non VAT registered trade I suggest you ask the selfbuilder to purchase the materials instead.
4) Self Builders cannot reclaim VAT on tool hire alone. For example a nail gun hire is standard rated and not reclaimable. However....
5) If the equipment comes with an operator (eg digger and driver) then this counts as labor and both must be zero rated to the self builder.
The above applies to most things incorporated into the house or plot but there are exceptions such as carpets or white goods that are standard rated and not reclaimable.
Demolition of an existing building and similar work that is closely associated with the construction of a new house (eg diverting services) must also be zero rated to the self builder.
Most landscaping work should be zero rated to the self builder (eg Fences, lawns, driveways, patios). However VAT on trees and plants can only be reclaimed if they are shown on a landscaping plan attached to the planning permission. Such a drawing isn't always mandatory to get Planning Permission but can be provided voluntarily with the planning application.
Sometimes HMRC will refuse to refund VAT on items "not normally incorporated into a dwelling", the only example i can recall was a car turntable needed to allow a car to drive out of a tight plot in forward gear. However I think that was overturned and allowed on appeal.
Some trades are reluctant to zero rate the materials they supply and fit (see 3 above). If you are worried HMRC won't refund you ask the self builder for a certificate. This is essentially a letter stating that the work should be zero rated and including details of the project such as their name, address, planning reference etc. Neither the trade nor the self builder is obliged to provide a certificate to HMRC according to the rules but they have been found to help smooth problems.
Conversions are treated differently to New Builds. In general 5% VAT should be charged instead of zero rating and the owner can reclaim it.
PS: If a trade provides a quote for labor that incorrectly includes VAT I recommend self builders ask for the quote to be amended before accepting it. That may avoid an argument later.
1) Self Builders can reclaim the VAT they have paid on materials. They cannot reclaim the VAT that trades have purchased for them see 3).
2) Labor must be zero rated to the self builder. They cannot reclaim VAT incorrectly paid on labor..
3) In the case of "Supply and fit" on the same invoice BOTH must be zero rated to the self builder. A typical example would be an electrician or plasterer. If you are a non VAT registered trade I suggest you ask the selfbuilder to purchase the materials instead.
4) Self Builders cannot reclaim VAT on tool hire alone. For example a nail gun hire is standard rated and not reclaimable. However....
5) If the equipment comes with an operator (eg digger and driver) then this counts as labor and both must be zero rated to the self builder.
The above applies to most things incorporated into the house or plot but there are exceptions such as carpets or white goods that are standard rated and not reclaimable.
Demolition of an existing building and similar work that is closely associated with the construction of a new house (eg diverting services) must also be zero rated to the self builder.
Most landscaping work should be zero rated to the self builder (eg Fences, lawns, driveways, patios). However VAT on trees and plants can only be reclaimed if they are shown on a landscaping plan attached to the planning permission. Such a drawing isn't always mandatory to get Planning Permission but can be provided voluntarily with the planning application.
Sometimes HMRC will refuse to refund VAT on items "not normally incorporated into a dwelling", the only example i can recall was a car turntable needed to allow a car to drive out of a tight plot in forward gear. However I think that was overturned and allowed on appeal.
Some trades are reluctant to zero rate the materials they supply and fit (see 3 above). If you are worried HMRC won't refund you ask the self builder for a certificate. This is essentially a letter stating that the work should be zero rated and including details of the project such as their name, address, planning reference etc. Neither the trade nor the self builder is obliged to provide a certificate to HMRC according to the rules but they have been found to help smooth problems.
Conversions are treated differently to New Builds. In general 5% VAT should be charged instead of zero rating and the owner can reclaim it.
PS: If a trade provides a quote for labor that incorrectly includes VAT I recommend self builders ask for the quote to be amended before accepting it. That may avoid an argument later.
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