15% SAVINGS IN VAT
For several clients we have paved the way for their accountants to negotiate a 15% VAT reduction with the Inland Revenue.
5% VAT is applicable to any commercial transactions as opposed to 20% VAT on standard works.
CASE 1: NURSING HOME CONVERSION
A client purchased a nursing care home to convert into their home. They were surprised but delighted with our advice that an application for change of use should reduce VAT on building works from 20% to 5%.
With Inland Revenue support, they subsequently saved in excess of £100,000 in VAT which they had never anticipated.
The same principle can apply in converting any commercial buildings in office, school, or any other commercial use classification back to residential.
CASE 2: FORMING ANNEX FLAT BY DIVISION WITHIN A HOUSE
More recently we encouraged a client involved the major refurbishment of a country house to seek planning consents to form a self-contained service flat.
This was accepted by Inland Revenue as being a sub-division resulting in very significant VAT savings set against the whole project.
The same can apply to a country estate in converting other properties within the estate by conversion or sub-division parts back to residential use.
CASE 3: REINSTATING TWO HOUSES BACK INTO ONE
In another case a client bought a flat above their home in the New Town to extend into one larger house. We obtained planning consents and Inland Revenue conceded to this being a development and it, too, attracted 5% VAT as a very welcome and significant saving.
We look to apply lateral thought for all clients in all aspects of our work. VAT savings are only one example.