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DIY house build through company

What should company charge client for house construction

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A 100% shareholder/director wants to get his property company to construct a new residence for him. One benefit of using the company is that they can zero rate the work for VAT.

From a tax point of view though can the company just charge him at cost or should a small profit be charged? 

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RLI
By lionofludesch
23rd Nov 2018 09:03

Who owns the land ?

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Replying to lionofludesch:
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By alltaxedout
23rd Nov 2018 09:46

Sorry, the director owns the land - so it will be construction services provided to him

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By C Graham
23rd Nov 2018 10:18

He can recover the vat anyway - if it is a new build and not a business premises. And you state it is a residence for himself.

https://www.homebuilding.co.uk/maximise-your-vat-reclaim/

the labour is zero rated on a new build.
Presumably any profit his solely owned company makes is liable for corp tax - and if he is paying his own company he should do it in the most tax efficient way possible.

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Replying to C Graham:
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By Vile Nortin Naipaan
23rd Nov 2018 10:37

But if there's no profit, then the supply is not mad in the course of furtherance of a business carried on by the company, and it could be denied recovery of its input VAT on the project.

There was a design and build thread recently, which also identified other issues too.

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Replying to Vile Nortin Naipaan:
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By lionofludesch
23rd Nov 2018 10:48

Vile Nortin Naipaan wrote:

There was a design and build thread recently, which also identified other issues too.

Yes, I was looking for that but couldn't find it.

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Replying to lionofludesch:
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By Vile Nortin Naipaan
23rd Nov 2018 10:59
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