Sorry for asking such a basic question but I'm hard pressed to find an answer ont' Net!
A client's company owns the trading premises, and there is no Opt To Tax.
He is repairing some flooring and insulation (£5k) and wants to know whether the VAT can be recovered?
I presume not, however I'm not sure whether the Capital v Repair rules (or similar) would apply in a VAT situation.
Related resources
Replies (2)
Please login or register to join the discussion.
Property Repairs
The Capital Goods Scheme does not apply to repairs below £250,000, so you don't need to worry about that!
Whether input tax can be reclaimed depends on whether the property is being used for a taxable trading business, or for letting to a third party. If the property is being used for a taxable trading business, the input tax is recoverable, irrespective of an option to tax. If the property is being let, then the input tax is not recoverable. This is subject to the normal rules relating to there being a proper VAT invoice. It is also subject to Partial Exemption, if there is other exempt activity.
VAT on redecoration
managing agent has sent demand for our share of external redecoration of office block
there is VAT charged on the rent we pay but VAT is not mentioned in the agent's demand - is this normal practice or should I ask whether VAT is included?