How to refund for VAT charged for building work eligible for VAT relief.

A supplier who has charged my Mum VAT for work that is eligible for relief under the Govt scheme is saying they don’t know how to refund. Mum has a disability and has had her bathroom adjusted to make it accessible. One supplier has refunded VAT but another says they don’t know what to do. We have completed the customer part of the eligibility declaration and have given them the form to complete their part but they don’t seem to know how to account for the VAT refund. Andy advice please that I can pass on to them.

The builder charged VAT and has paid that over to HMRC (hopefully). The builder now just needs to issue a credit note for the VAT only element, HMRC will refund the builder, builder can refund your Mum. The builder might argue that they will refund your Mum once they've had the refund from HMRC, if they say this, ask them when their next VAT quarter period will be, VAT registered traders submit VAT returns each quarter, if their VAT quarter is say Sept-Oct-Nov, and they raise credit note in November, they will file the VAT return for that period by the 7th January and would get the refund a week or so later. If the builder is very helpful they will issue the credit note and refund the money to your Mum now in time for Christmas and then they will submit their VAT return and await their refund from HMRC in January.

Thank you, this is really helpful.

Hi,

If they have the signed form to confirm that the relief is applicable then the supplier should not have charged VAT.
If they have charged VAT then they should be refunding the customer and completing an error correction so that they can recover any VAT which they made paid over to HMRC in error.
We recommend referring the supplier to the following guidance:

Correcting VAT errors on a return already submitted

Thank you.