VAT on Listed Building Repairs : Understanding HMRC Changes

As of the 1st October 2012, owners of listed buildings and heritage sites across the UK became disgruntled. Prior to such date, VAT on listed building repairs was 0%. A jump to 20% for materials and services supplied has meant that owners of listed buildings now have to spend a lot more money to carry out vital repairs and preservation work.

VAT on repairs and maintenance of churches and places of worship as well as memorials are not as affected as privately owned builds. Grants can be applied to that will cover the amount of VAT paid. This scheme is funded by the Department for Digital, Culture, Media and Sport. As well as this, exemption from VAT applies to private treaty sales to some museums and heritage bodies.

VAT on Listed Building Repairs : What Constitutes Alterations?

It is important to understand just what is classed as an alteration to your build, and you can be forgiven for any confusion. HMRC’s definition is complex, yet it is more than difficult to understand and to an extent it is also subjective. If you are in doubt, then contact Bristol Builders Network. We can put you in touch with experts within the field of listed building repairs who can advise you.

VAT on listed building repairs

According to HMRC, alterations to a listed building are those that involve the changing of its fabric. These can include internal surfaces, walls, stairs, floors, door, windows, wiring, and plumbing. These changes must be “meaningful” and they differ from repair and maintenance work. Repair work and maintenance on listed buildings is work that is carried out that will minimize the need for further scale repairs, for as long as is possible. This type of VAT on listed building repairs has always been set at 20%.

HMRC said the changes made were to remove an unfair tax advantage from owners of listed builds. It is also seen as a measure to stop people from wishing to change listed buildings as opposed to repairing them. This unfair advantage to listed building owners is something that many have rightfully failed to comprehend. The HRMC are failing to see the importance of protecting our heritage in the UK by applying VAT on repairs.

Owners of listed buildings therefore have to dig deeper into their pockets to carry out restoration work to their properties that was otherwise exempt. Carrying out repairs and maintenance to listed buildings has always been expensive. But this expense is not extended to restoration work that is said to have meaningful change on the build in question.

Conclusion

For example, changing the windows in your listed building is now subject to VAT. For people who invested in builds in need of restoration prior to 2012, the new legislation came as a big shock. Windows and doors can only be “repaired” for so long before they need to be replaced. And the cost of replacing windows with windows that do not alter the external appearance of a home will always be more expensive than adding double glazing to a suburban semi.

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