Value Added Tax Act 1994

35 Refund of VAT to persons constructing certain buildings. U.K.

[F1 (1) Where—

(a) a person carries out works to which this section applies,

(b) his carrying out of the works is lawful and otherwise than in the course or furtherance of any business, and

(c) VAT is chargeable on the supplyF2 ... or importation of any goods used by him for the purposes of the works,

[F3 subject to subsections (2) to (2C),] the Commissioners shall, on a claim made in that behalf, refund to that person the amount of VAT so chargeable.

(1A) The works to which this section applies are—

(a) the construction of a building designed as a dwelling or number of dwellings;

(b) the construction of a building for use solely for a relevant residential purpose or relevant charitable purpose; and

(c) a residential conversion.

(1B) For the purposes of this section goods shall be treated as used for the purposes of works to which this section applies by the person carrying out the works in so far only as they are building materials which, in the course of the works, are incorporated in the building in question or its site.

(1C) Where—

(a) a person (“the relevant person”) carries out a residential conversion by arranging for any of the work of the conversion to be done by another (“a contractor”),

(b) the relevant person’s carrying out of the conversion is lawful and otherwise than in the course or furtherance of any business,

(c) the contractor is not acting as an architect, surveyor or consultant or in a supervisory capacity, and

(d) VAT is chargeable on services consisting in the work done by the contractor,

[F4 subject to subsections (2) to (2C),] the Commissioners shall, on a claim made in that behalf, refund to the relevant person the amount of VAT so chargeable.

(1D) For the purposes of this section works constitute a residential conversion to the extent that they consist in the conversion of a non-residential building, or a non-residential part of a building, into—

(a) a building designed as a dwelling or a number of dwellings;

(b) a building intended for use solely for a relevant residential purpose; or

(c) anything which would fall within paragraph (a) or (b) above if different parts of a building were treated as separate buildings.]

(2) The Commissioners shall not be required to entertain a claim for a refund of VAT under this section unless the claim—

(a) is made within such time and in such form and manner, and

(b) contains such information, and

(c) is accompanied by such documents, whether by way of evidence or otherwise,

[F5 as may be specified by regulations or by the Commissioners in accordance with regulations.]

[F6 (2A) Where a person has made a claim for a refund of VAT under this section, before determining the claim the Commissioners may by notice require the person to produce further documents, by way of evidence or otherwise, that the Commissioners reasonably require in connection with the claim.

(2B) A notice under subsection (2A) must specify the time within which, and the form and manner in which, the documents must be produced.

(2C) Where the person does not produce the documents required by a notice under subsection (2A), the Commissioners may refuse to refund the amount of VAT (or any part of it) in respect of which the claim was made.]

F7 (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F8 (4) The notes to Group 5 of Schedule 8 shall apply for construing this section as they apply for construing that Group [F9 but this is subject to subsection (4A) below.]

[F10 (4A) The meaning of “non-residential” given by Note (7A) of Group 5 of Schedule 8 (and not that given by Note (7) of that Group) applies for the purposes of this section but as if—

(a) references in that Note to item 3 of that Group were references to this section, and

(b) paragraph (b)(iii) of that Note were omitted.]

(5) The power of the Treasury by order under section 30 to vary Schedule 8 shall include—

(a) power to apply any variation made by the order for the purposes of this section; and

(b) power to make such consequential modifications of this section as they may think fit.]

Textual Amendments

F1 S. 35(1)(1A)-(1D) substituted (29.4.1996 with application as mentioned in s. 30(4) of the amending Act) for s. 35(1) by 1996 c. 8, s. 30(1)

F2 Word in s. 35(1)(c) omitted (31.12.2020) by virtue of Taxation (Cross-border Trade) Act 2018 (c. 22), s. 57(3), Sch. 8 para. 37(2) (with Sch. 8 para. 99) (with savings and transitional provisions in S.I. 2019/105 (as amended by S.I. 2020/1495, regs. 1(2), 21), S.I. 2020/1545, Pt. 4 and 2020 c. 26, Sch. 2 para. 7(7)-(9)); S.I. 2020/1642, reg. 4(b) (with reg. 7)

F3 Words in s. 35(1) inserted (with effect in relation to claims made on or after 24.5.2024) by Finance (No. 2) Act 2024 (c. 12), s. 23(1)(a) (with s. 23(2))

F4 Words in s. 35(1C) inserted (with effect in relation to claims made on or after 24.5.2024) by Finance (No. 2) Act 2024 (c. 12), s. 23(1)(a) (with s. 23(2))

F5 Words in s. 35(2) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 29 para. 4

F6 S. 35(2A)-(2C) inserted (with effect in relation to claims under this section made on or after 24.5.2024) by Finance (No. 2) Act 2024 (c. 12), s. 23(1)(b) (with s. 23(2))

F7 S. 35(3) omitted (31.12.2020) by virtue of Taxation (Cross-border Trade) Act 2018 (c. 22), s. 57(3), Sch. 8 para. 37(3) (with Sch. 8 para. 99) (with savings and transitional provisions in S.I. 2019/105 (as amended by S.I. 2020/1495, regs. 1(2), 21), S.I. 2020/1545, Pt. 4 and 2020 c. 26, Sch. 2 para. 7(7)-(9)); S.I. 2020/1642, reg. 4(b) (with reg. 7)

F8 S. 35(4)(5) inserted (29.4.1996 with application as mentioned in s. 30(4) of the amending Act) by 1996 c. 8, s. 30(3)

F9 Words in s. 35(4) inserted (1.8.2001) by S.I. 2001/2305, art. 4(a)

F10 S. 35(4A) inserted (1.8.2001) by S.I. 2001/2305, art. 4(b)