VAT DIY housebuilders scheme
HMRC have reasserted their view that roller blinds (and other ‘window furniture’) are not ‘building materials’ as defined in law and therefore do not qualify for zero-rating.
This move follows a recent Tribunal decision which allowed a taxpayer’s claim that roller blinds were ‘building materials’. This confirmed that the taxpayer was entitled to recover the VAT incurred on the purchase of the blinds as recoverable from HMRC under the VAT DIY housebuilders scheme. The DIY housebuilders scheme was designed to ensure that a homeowner building a home can benefit from the VAT rules which allow thequalifying construction costs of new homes and certain conversion works to be zero-rated.
HMRC are not appealing the tribunal decision given the small amount of VAT at stake in this particular case. However, in response to this decision by the tribunal, HMRC have issued a Revenue & Customs Brief which stresses that HMRC’s view remains unchanged on such matters. The definition of building materials only includes items usually included in a new house or flat like bathroom taps, kitchen sinks, windows, toilets and shower units. There are also a number of items which are allowed such as kitchen furniture, wood or laminate flooring (but not carpet) and basic wardrobes.