VAT on New Build to be Rental Property

VAT on New Build to be Rental Property

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Property Development Limited Company (registered for VAT) has been contracted by the director/shareholders to build a development of 8 houses on the directors private land.

They want to sell 4 & keep 4 to rent out.

As far as I understand the rules for new builds, the Ltd Co can charge 0% on the ones that are going to be sold, but charge 17.5% on the development of the ones that the directors are going to keep & rent out.

However, I am trying to think of a clever way to charge 0% on everything and one of my thoughts (which will also help for IHT) is to sell the other 4 into a Trust for the Directors children. Can the Ltd co legitamately charge 0% VAT on the properties if they are being sold by the directors to a Trust? Or am I stuck with the 17.5% on these?

Stacey

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