Commerical property has been sold to my client with no VAT being charged, they are a developer. At present they have paid a deposit and exchanged contracts but will not complete until my client obtains planning permission. They may then sell the property with the benefit of the planning (which basically includes demolishing the building and building new houses) or they will undertake the work themselves to then sell on the houses (thus creating zero rated supply)
They are starting to incur a fair amount of professoinal fees (architects etc.) so would like to reclaim the VAT, my question is at what point can they opt to tax the property, now or do they wait until completion? As they are unsure of their intention with the property (sell with planning or develop properties themselves) I assume to be sure they would need to opt to tax property, even if they end demolishing them, to enable a VAT reclaim on the opted property if they just sell with planning?