VAT
The VAT position about building work relating to churches is as follows: Construction worksThe following are zero-rated (so that the builder/supplier doing the work should not charge VAT). Construction of a new churchThis is subject to the issue of the appropriate certificate to the builder. A church building is regarded as new for this purpose if:
Construction of a new annex to a churchWhere:
In cases where what is constructed does not meet the conditions above, it will not be zero-rated for VAT purposes and is likely to be an extension to the building. As such, it would therefore be eligible for the Listed Places of Worship Grant Scheme. Construction of a new church hallThis is subject to the issue of the appropriate certificate, provided that the hall is to be used for the provision of social or recreational facilities for the good of the local community. DemolitionWhere the work is in the course of construction or re-construction which will itself be zero rated, and the demolition is down to ground level (but leaving foundations or leaving a single facade wall). Repairs, maintenance and alterationsThese are standard rated but in the case of listed buildings mainly used for public worship the VAT can be recovered under the Listed Places of Worship Grant Scheme. The Listed Places of Worship Grant Scheme makes grants towards the VAT incurred in making repairs and carrying out necessary alterations to listed buildings mainly used for public worship. The grant is paid to you after the work has been done and paid for. You need to retain original copies of all receipted repair invoices. A parallel scheme deals with public monuments and memorials. Details of the scheme are available on a helpline: 0845 601 5945 There is also a Memorials grant scheme. Sarah Williams at Harris & Harris can be contacted for advice in relation to listed/non-listed building status. Aids for people with disabilities on church premisesThe following are zero rated:
Energy savings materialsThe following carries reduced rate relief: the installation of certain energy savings materials is subject to the reduced rate of 5% when installed in buildings used for a relevant charitable purpose (see Public Notice 708/6 “Energy-Saving Materials” Chapter 2). Where works are zero rated, the builder/supplier will require an eligibility certificate from the charity. Please see the website. HMRC VAT Helpline: 0300 200 3700. |