Lee Sharpe points out that the First-tier Tribunal has said HMRC was wrong to insist that DIY Housebuilder VAT claims can be made only once per building and after the work has been completed.
There is a mechanism for private individuals to reclaim VAT when building their own homes (or directly paying a builder or similar to build the house for them). Where a property developer builds a new dwelling for sale or ‘long lease’, the supply is zero-rated, and the developer may register for VAT, reclaim the bulk of the VAT cost on construction (there are some restrictions), but then charge £0 VAT on the sale. The new homeowner incurs no actual VAT cost, but the developer is still able to reclaim most of the VAT they have incurred.
The DIY Housebuilder Scheme is intended to put people who want to build their own homes on a broadly similar footing.
HMRC has always insisted that only a single DIY
