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Relaxations to the notification to opt to tax land and buildings for VAT

Supplies of non-residential land and buildings are normally exempt from VAT, which means you cannot normally recover VAT incurred on costs relating to sales and lettings. 

Last updated: 28 May 2020

However, you can opt to tax so that the supplies become standard-rated, and you can usually recover VAT you incur from the effective date of the option. 

If you decide to opt to tax, you are normally required to notify HMRC within 30 days of the decision by either:

  • Printing and sending the notification, signed by an authorised person within the business; or
  • Emailing a scanned copy of the signed notification.

Due to COVID-19 social distancing, these rules are now difficult to follow, so HMRC has temporarily changed the timing of notification and submission of the forms. 

The new rules:

  • Decisions to opt to tax made between 15 February and 30 June 2020 will only need to be notified within 90 days.
  • Forms can be submitted with an electronic signature as long as you provide evidence that the signature is from a person authorised to make the option on behalf of the business.
  • Evidence can be in the form of an email from the authorised signatory or an email chain showing consent for the option. 
  • Tax Agents need to send evidence that they have authority from the business (such as a scanned letter of authority) and the signatory is authorised to make the option.

All forms and notifications should be sent via email to optiontotaxnationalunit@hmrc.gov.uk

About the author

Linda Skilbeck

+44 (0)20 8037 3114
skilbeckl@buzzacott.co.uk
LinkedIn

Last updated: 28 May 2020

However, you can opt to tax so that the supplies become standard-rated, and you can usually recover VAT you incur from the effective date of the option. 

If you decide to opt to tax, you are normally required to notify HMRC within 30 days of the decision by either:

  • Printing and sending the notification, signed by an authorised person within the business; or
  • Emailing a scanned copy of the signed notification.

Due to COVID-19 social distancing, these rules are now difficult to follow, so HMRC has temporarily changed the timing of notification and submission of the forms. 

The new rules:

  • Decisions to opt to tax made between 15 February and 30 June 2020 will only need to be notified within 90 days.
  • Forms can be submitted with an electronic signature as long as you provide evidence that the signature is from a person authorised to make the option on behalf of the business.
  • Evidence can be in the form of an email from the authorised signatory or an email chain showing consent for the option. 
  • Tax Agents need to send evidence that they have authority from the business (such as a scanned letter of authority) and the signatory is authorised to make the option.

All forms and notifications should be sent via email to optiontotaxnationalunit@hmrc.gov.uk

Get in touch

For more information on the above or for VAT advice tailored to your organisation, please get in touch with Linda Skilbeck or fill out the form below.

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