Recent updated VAT notices from HMRC – October 2013

Recent updated VAT notices from HMRC

In the past couple of weeks HMRC has published updated versions of its:

  • Building and Construction;
  • Catering and take-away food; and
  • Clubs and Associations

notices. The first two are incorporating guidance that was released last year as Information Sheets following the changes to the law in the Finance Act 2012 to deal with ‘Borderline Anomalies’.

Building and Construction

HMRC has published an updated version of Notice 708: Building and Construction dated October 2013 to replace the November 2011 edition.

HMRC indicates that changes in content appear in Sections 9 and 10 as follows:

  • the rules relating to approved alterations of protected buildings have been changed with effect from 1 October 2012;
  • works of approved alterations will be standard-rated from 1 October 2012;
  • there is a transitional relief that mitigates the impact of the changes;
  • the rules relating to the first grant of a major interest in a substantially reconstructed buildings have been changed;
  • the effect of these changes is to restrict zero-rating so that it is no longer available for buildings where substantial reconstruction amounts to three-fifths of the cost of the works;
  • zero-rating remains where the works relate to a building substantially reconstructed from a shell;
  • The changes to the grants made in respect of substantially reconstructed buildings are subject to a transitional relief.

The updated notice is a must read for those advising builders and the builders themselves involved in work on listed buildings. The guidance on these items was previously in Information Sheet 10/12: VAT: approved alterations to listed buildings.

Catering and take-away food

HMRC has published an updated version of Notice 709/1: Catering and take-away food dated October 2013 to replace the November 2011 edition.

This update incorportates the guidance previously given in Information Sheet 12/12: Hot food and premises. The guidance is a must read for café, chip shop and other business owners that provide take-away food.

Clubs and Associations

HMRC has published an updated version of Notice 701/5: Clubs and Associations dated October 2013 to replace the June 2013 edition.

HMRC indicates that the following changes have been made:

  • Section 7.1 – amended to confirm the VAT liability of machine game receipts; and
  • Section 8 – clarification of the tax point for the treatment of unused credit balances or unredeemed vouchers.

This one is for clubs and associations that have gaming machines on their premises following the change in VAT treatment from standard rated to exempt. This might result in such organisations having to restrict input tax recovery – in which case they’ll need to consult VAT Notice 706: Partial Exemption.

On the other hand, those that need help in these areas could contact their VAT adviser and get advise geared to their business circumstances.

Any queries please leave a comment.

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