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Reduced VAT rates for Empty Properties


See Factsheet 4: VAT, Planning Control and Building Regulations

Reduced rate VAT

If you are using builders, the home must have been empty for more than two years before works start. Then you may be able to pay VAT at the reduced rate (currently 5%). Further details are available on HMRC notice 708. There is no equivalent reduced VAT rate for DIY work.

Zero rate VAT (using builders)

If you are using builders, the home must have been empty for more than ten years before works start. Then VAT may be zero-rated. Further details can be found in HMRC notice 708.

Zero rate VAT (DIY work)

If you are carrying out the building work yourself, and the property has been empty for more than ten years.  VAT on building materials is zero-rated. You will need to pay your suppliers the full cost inclusive of full VAT and then reclaim the VAT element from HMRC. Further details are available in HMRC notice 431C 

Where can I get more information?

You can contact your council empty property officer(contact details overleaf for each authority).

You can check out the Homes and Communities Agency Empty Property Toolkit.

You can look at HMRC notice 708 and HMRC notice 431C

Alternativley check out the information on the Empty Homes Agency website.

You may be entitled to reclaim the VAT on the cost of renovating your empty property!
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