Is There Any Way To Reduce The Vat Payable On An Extension

[talkinpeace]

remember that energy efficiency measures (and ancilliaries) have a VAT rate of 5%

so I got my solar panel, collector tank (which just happens to be a hot water cylinder), all the connecting (and control plumbing) etc etc at 5%

pay labourers directly - your main contractor will like that as it saves them CIS

[harumph]

I'm just gob smacked by the potential costs involved of having an extension done. £1,000 - £1,200 per square seems to be the going rate and then there's the 20% VAT on top.

In order to have useful space that is in proportion with the rest of the house our proposed 2 storey extension will add on about 100 square meters.

So i'm looking at £20,000 or more of VAT (plus then all the VAT i'll have to pay on all the additional bits and pieces) and this is a deal breaker.

If i've got to pay that much tax I just won't go ahead with the project, especially as i'd have to stick that cost on the mortgage so would be paying interest on it.

In principle I refuse to pay more for the extension than the fekking house cost in the first place.

Does anyone know of any clever legal ways to get around it?

I've had a look on the HMRC website and there's not a lot there that could help.

Hey, I'm not telling you to do this, but I have a colleague who built a whackin' great extension including a 30k kitchen. I don't know the final figure but I guess around 100 - 125k and he set up a limited company to do building work, then registered for VAT - claimed everything back from the first "job" and then stiffed himself on the payment and folded the business (this was in about 2002) - I can't tell you how he convinced the vatman that his first "job" was at his house - but it's more than probably that the information never came out. No reason to as far as I can tell. Anyhoo... don't speak to him much any more, but I bet there's something worth googling in there, if you are so inclined (which I highly recommend you not to be!).

[porca misèria]

Hey, I'm not telling you to do this, but I have a colleague who built a whackin' great extension including a 30k kitchen. I don't know the final figure but I guess around 100 - 125k and he set up a limited company to do building work, then registered for VAT - claimed everything back from the first "job" and then stiffed himself on the payment and folded the business (this was in about 2002) - I can't tell you how he convinced the vatman that his first "job" was at his house - but it's more than probably that the information never came out. No reason to as far as I can tell. Anyhoo... don't speak to him much any more, but I bet there's something worth googling in there, if you are so inclined (which I highly recommend you not to be!).

That smells of urban myth. If a limited company folds in suspicious circumstances, HMRC tend to notice and will prosecute if it looks like a deliberate wheeze. Suspicious circumstances include any significant debts between the company and its owners, or debt to the taxman.

Though your account is unclear on who owed what and to whom when it folded.

[porca misèria]

It's unusual and old (1894 and built with cavity walls) so it may qualify but wouldn't being listed then shaft me for the changes?

1894 ain't old!

More to the point, it's a time from which lots of unremarkable housing remains (so much better built than more recent crap). Listing is unlikely to happen unless it's in some way remarkable. And of course listing would almost certainly preclude planning permission for any extension, let alone one on the scale you're looking at!

[pokercola]

You don't have to pay VAT if you are disabled and the modification is making your house more accessible. Have you considered perhaps sawing your legs off?

[Spot]

You don't have to pay VAT if you are disabled and the modification is making your house more accessible. Have you considered perhaps sawing your legs off?

Radical... But interesting! Thinking outside the box. Like it.