The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
This guidance note provides an overview of the VAT treatment of the sale or grant of a long lease in a protected building.
For an overview of the liability of supplies of land more broadly, see the Overview of VAT and property issues guidance note.
Detailed commentary on legislation and case law can be found in De Voil Indirect Tax Service V4.232C and V4.235.
Zero-rating can apply to the sale or grant of a lease where the following conditions are met:
work is carried out on a ‘protected building’
the protected building is ‘substantially reconstructed’
there is a grant of a ‘major interest’ in the building
the grant is the first grant of a major interest
the person making the grant has ‘person substantially reconstructing status’
the building is not a ‘holiday home’
if the grant is a tenancy, the payment is a premium or the first payment of rent
if appropriate, a zero-rating certificate has been issued to the supplier
VATA 1994, Sch 8, Group 5, Notes 13, 14, Group 6; VCONST10100; Notice 708, para 10.2.2
A ‘protected building’ is a building which is either:
a listed building
a scheduled monument
In addition, after reconstruction work it must either:
be designed to remain as or become a dwelling
be used solely for a ‘relevant residential purpose’
be used solely for a ‘relevant charitable purpose’
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