When you self build a new house it is zero rated for VAT.
So why in your magazine, when you state the amount a self builder spends on their project build and the amount of VAT reclaim does it never relate to the 20% VAT rate???
Self-builds are in fact zero rated for VAT – as long as you intend to live in the property.
However, there are a few reasons the amount of VAT reclaimed featured on our Reader's Home section differs from the 20% calculation you may be doing.
When self-builders hire a main contractor on a supply and fit basis, more often than not, this contractor is not charging VAT for the materials used (as they are doing the claim themselves). In this case, the amount paid is already VAT free.
Another reason the 20% of total cost calculation is not matching the amount of VAT reclaimed is that items not eligible for VAT claims are included in our elements cost box – such as carpets, ornamental fittings, bathroom furniture, smart home systems, etc.
For further guidance on what elements are eligible for VAT reclaim you can check out our guide at http://www.self-build.co.uk/our-guide-claiming-back-vat-self-build
Sofia Delgado, Build It's assistant editor
thanks very much for your prompt answer