My client bought an old Victorian house last year and is using a builder to convert it into flats which he intends to sell. The house was lived in until he bought it. The house is listed and the work has already started. Based on the details my client provided I was expecting that about 70% of the work would be zero-rated because it involves approved alterations to the fabric of the building. However I am now concerned that the changes from 1 October 2012 may mean that my client will have to pay more VAT. How will the changes affect him?
The two key questions in this situation are firstly what rate of VAT should the builder charge on carrying out the conversion work and secondly can your client reclaim any of this VAT?
In the absence...
