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Post Info TOPIC: Commercial Property VAT


Newbie

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Commercial Property VAT


Hi there

Hope someone can help point me in the right direction for some guidance.

Have two properties - one that has elected for VAT and another than has not

Is VAT on professional fees such as legal and accountancy irrecoverable for VAT if they don't relate specifically to the VAT elected property?

Surely accounting fees for preparing the VAT return could be? I ask because its in preparing the VAT return which only relates to the VAT elected property?

What about general legal advice on a potential purchase of another property if the intention is that that property will be VAT elected?

Would audit fees be irrecoverable?

Hopefully someone could point me to the relevant VAT legislation or guidance from HMRC?

Thanks so much



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Veteran Member

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Posts: 74
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You need to get an Accountant and ask them.

Better that than make an expensive mistake.

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Senior Member

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Posts: 468
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sw1085 wrote:

Have two properties - one that has elected for VAT and another than has not

Is VAT on professional fees such as legal and accountancy irrecoverable for VAT if they don't relate specifically to the VAT elected property?

Surely accounting fees for preparing the VAT return could be? I ask because its in preparing the VAT return which only relates to the VAT elected property?


Confused! From the way your post reads it sounds like you already have an accountant in which case they should be able to answer these questions for you, if not I would suggest as Casu says to get one ASAP



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Doug

These are only my opinions of how I see things and therefore should not be taken as advice



Guru

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Hi, you probably want to read VAT Notice 706 as a start point, helps to explain the differences in the transactions you are mentioning.

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Senior Member

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The Partial Exemption Notice is the place to start. You will need to work through it carefully, to avoid errors.
Assuming the business will continue to let commercial properties (and will acquire more?) I recommend a specialist look at the arrangements, and help you make the best of the Partial Exemption (and CGS) rules.

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Newbie

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Date:

so would you say our current reporting is a little off?

We recover 100% of the VAT on the opted properties and 0% on the residential but sounds like we need to take the revenue from commercial / revenue from commercial plus residential to get the recovery rate then recover only this % of ALL the costs?



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Master Book-keeper

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Posts: 6757
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This is a website for professionals not for business owners. Les recommends you get a specialist in. Two other posters recommend you get a specialist in.

Les is a specialist.

Put your hand in your pocket. You will save money by doing so as this is a complex area.

Don't rely on HMRC guidance alone as they have been known to provide rubbish in them that is at odds with the legislation.

__________________

Joanne McCormick

Fallows Hall Ltd

Winner - Bookkeeper of the Year 2015, 2016 and 2017

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

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