BB/17B/99 VAT: option to tax—property

Part V16 Forms and other HMRC material

BB/17B/99 VAT: option to tax—property

BB/17B/99 VAT: option to tax—property

Business Brief, Issue 17. 5 August 1999


This Business Brief concerns the decision by the VAT and Duties Tribunal in the case of Blythe Limited Partnership v C & E Comrs (“Blythe”) [(1999) VAT Decision 16011 unreported (Part V12)]. Customs did not appeal the decision. This Business Brief provides some practical steps businesses can take to ensure there are no misunderstandings over which properties they have opted to tax (“opted”). The option to tax allows businesses who sell, or grant either leases of or licences to occupy land to tax supplies that would otherwise be exempt, and thereby recover the input tax incurred in making those supplies.


Unless it is necessary to obtain Customs' written permission (para 8.6 of Notice 742 “Land and property” [Part V8] explains the circumstances when this would be required) to opt to tax (“to opt”), an option to tax (“an option”) comprises two actions. Firstly, the business decides to opt a building or piece of land and secondly it notifies this decision to Customs. For the option to take legal effect and allow the business to charge VAT on any future rents and sales notification must be

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