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Listed building owners in rush to beat VAT on restoration work
12:10pm Friday 13th July 2012 in Business Daily
WITH the introduction of VAT on listed buildings on October 1 fast approaching, many owners are frantically trying to complete alteration and restoration work to their listed properties to save thousands of pounds and secure the property’s future for generations to come.
On October 1, the Government is lifting the exemption on VAT to listed buildings, which it terms an “anomaly”, and imposing VAT at 20 per cent to all alterations and restorations in a move which will cost owners of listed buildings thousands of pounds just to ensure their property does not fall into disrepair.
Preservation of a listed building involves dedication in time and money due to the more expensive methods and materials required to maintain them.
RICS, along with much of the property industry, fears that the extra 20 per cent levied against owners of such buildings will mean the essential works will no longer be financially viable. As a result, many owners of listed properties are rushing to complete works and ensure the survival of the building and Britain’s heritage.
The lifting of the VAT exemption is also impacting on the desirability of listed properties to property investors, leaving many languishing on the market.
RICS, as part of the Cut the VAT Coalition campaign, is calling for the Government to abandon the introduction of 20 per cent VAT to listed buildings.
Stephen Thornton, UK head of external affairs at RICS, said: “Lower VAT on historic buildings would encourage the improvement of existing stock. However, an increase will create further barriers to improvements and stifle job creation.”
The campaign is also pushing for the reduction of VAT from 20 to five per cent for all home repair, maintenance and improvement works.
Mr Thornton added: “The Chancellor has missed a golden opportunity to create a level playing field on all residential works.
“Research shows that five per cent VAT across the board would create 26,560 jobs in the construction sector, with a total economic stimulus of around £1.7 billion in 2012 alone.”