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VAT on rental property repairs

We have a husband and wife partnership client (VAT registered, although all sales during last year were zero-rated), who also own some residential rental properties.

An electrician friend of theirs who also has residential rental properties, has told them that his accountant reclaims VAT on repairs undertaken to his properties, but only when there is a tenant in-situ. Our client has spoken to this accountant, who told him that if he switched accountants, he could start doing the same for him straight away.

I am not aware of any way of reclaiming such VAT, other than possibly small amounts via the partial exemption method - am I missing something?

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02nd Jul 2012 13:35

Similar Q

posted a few months ago:

http://www.accountingweb.co.uk/anyanswers/question/vat-residential-property

 

See also this.  The question was asked in 2010 but two very recent responses:

 

http://www.accountingweb.co.uk/anyanswers/vat-and-rental-income

 

 

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02nd Jul 2012 19:12

You are not missing anything. Your friend will be using the 'de minimis' limit rule to recover his VAT on repairs and maintence. £625 exempt input tax on average and £7500 per annum subject to the other partial exemption rules.

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