Commercial Law Services

Commercial property

"To opt to tax or not"

Put simply, where commercial property transactions would otherwise be exempt from VAT, the person holding the interest in the land (including any buildings on it) may choose to charge VAT.

The benefit of doing so, is of course, tied up with the recovery of VAT on related costs. So, a commercial property developer, having incurred the costs of refurbishing a building or constructing a new building to let, will be likely to opt to tax in order to be able to recover the VAT incurred on the building and other costs incurred - rather than make an exempt supply and be unable to recover the VAT incurred.

To find out more please contact Ian Pentecost or Mark Smith.