My Client is a small residential developer. We have recently bought a property to refurbish. Our usual business is development of new build property which is zero rated, however, I think that when we come to sell the refurb it will be an exempt suplly. This property has been empty for over 2 years and I think I am correct in thinking that it therefore qualifies for a reduced rate vat. Do I therefore request that all supplies are made at the reduced rate and if so what do my suppliers require to comply with HMRC regulations?
Obviously as a developer of new homes we are used to claiming all VAT back whereas if the sale of the refurb is exempt we won't be able to claim the vat back on that property, therefore, if VAT can be reduced rated then this will at least give us a slightly better margin.