VAT on barn conversion

We are considering buying a former mill and grain store which lies within the Grade B listed cartilage of a nearby farmhouse. We are planning to develop the mill & grain store into 2 residential properties, subject to planning permission for development of a redundant farm building. If we retain these converted properties for use as personal holiday homes (with no business use) & reclaim VAT under the DIY Housebuilder scheme, is there any time restriction and/or VAT implication with regards to when the properties can subsequently be sold? If we undertake the conversion with the intent of selling/renting, can you confirm the applicable VAT rate?

Hi,

The guidance does state:

You are not eligible to use the scheme if:

You are converting a property that, because of a term in the planning permission, or similar permission such as a planning agreement, cannot be sold separately or used separately.

You are converting a property that either you, or your relatives, do not intend to live in, but intend to sell or let out, or use for any other business purpose, a business purpose includes dwellings built because you need to live where you work.

Your building will be used for a business purpose and you are a:
speculative developer
landlord
bed and breakfast operator
care home operator who make a charge, even if not for profit, to their residents
membership club and association

You can see the guidance below:

Conversions not eligible for the scheme

There is no strict timescale after which you can sell the property, however at the time the property is converted there needs to be an intention for the property to be lived in by yourself or your relatives.

Thank you.