Share this content
5

VAT on land and option to tax

Is VAT chargeable on sale of land

Didn't find your answer?

Client company opted to tax some farm land over 10 years ago and charged VAT on rent from a Farm Business Tennancy. The FBT has now ceased and the company is selling a small amount of land as residential garden / access to a residential property not owned by the company. My thoughts are that as the sale of land is residential no VAT will need to be charged as the transaction is residential. Am I correct as it all seems too simple? Any help would be much appreciated.

Replies (5)

Please login or register to join the discussion.

avatar
By carynw
23rd Sep 2019 09:59

If the land has been opted to tax then VAT is chargeable regardless of who its sold to

Thanks (0)
Replying to carynw:
avatar
By millertime
23rd Sep 2019 10:08

Thanks carynw, is there anyway we could use Section 3 of VAT Notice 742a ? I think I'm clutching at straws and appreciate though that this is not part of a new build project.

Thanks (0)
avatar
By The Dullard
23rd Sep 2019 10:28

VAT is chargeable. If the purchaser builds a dwelling on the land they may subsequently be able to recover the VAT.

Thanks (0)
chips_at_mattersey
By Les Howard
23rd Sep 2019 14:16

The 'disapplication' rules apply differently to land as to buildings. The purchaser can only have your option to tax disapplied if it is a DIY building project.

Thanks (0)
Replying to leshoward:
avatar
By millertime
23rd Sep 2019 14:26

Thanks Les, ahh well guess they'll be charging the VAT.

Thanks (0)
Share this content