DIY Housebuilder VAT Refund 431C - eligibility of property empty more than 10 years

Hi, I'm looking for clarification on the eligibility of a property that has been empty for more than 10 years. I have purchased the property and intend to renovate for re-sale or rental. I will not be occupying the property. The HMRC guidance note on 'VAT refunds for conversions if you’re a DIY housebuilder' states within the initial section on conversions eligible for the scheme, 'converting a derelict residential property for either you or your relatives, that has not been lived in (for 10 years or more before the work began)'. Below this under 'Other types of conversion work eligible' it includes the following, 'in the 10 years immediately before the start of the work, the building (or part) has not been used as a dwelling or number of dwellings' which suggests that I don't need to occupy the property. However, under the 'Conversions not eligible' it states 'you’re converting a property that either you, or your relatives, do not intend to live in, but intend to sell or let out' So if I don't move into the conversion is it eligible or not eligible for VAT refund under the DIY housebuilder scheme?

Hi,

The DIY scheme is only available for individuals who refurbish a property that has not been lived in for 10 or more years and then intend to live in that property.

If you renovate the property and then intend to sell or rent it out, then this prevents you from being able to use the scheme. The renovation work completed on the property should still be done at the reduced rate of VAT by the builder but the DIY Scheme will not be available to you to reclaim the 5% VAT or any VAT you incur.

Yoy can see the guidance below regarding the reduced rate work for properties not lived in for 2 or more years:

Reduced rating the renovation or alteration of empty residential premises

Thank you.

Dear HMRC Admin 19, Thanks for the clarification. Spencer