Auction price + vat?

Dexterd

Hello, i recently bought a property at auction, i am a private buyer and it turns
out the property is subject to vat.
It was a contractor that built the house and kept it for over 2 years renting
it out, then it was repossessed and sold at auction.
There was a note in the legal pack stating that vat may be due.
Does anyone think there is a way out of this?

Victor

You really need to talk to a tax advisor.

That you bought at auction means you have very little comeback against the vendor's side - you are expected to come to an auction with open eyes.

StillWaters

What does your solicitor say? was it occupied for over 24 months?

Dexterd

Yes it was occupied for over 24 months, my solicitor says I have a good case not to pay the vat on the grounds of improper advertisement and it should have been clearly stated.
I am afraid to dispute it as I might loose my deposit some way or other!
I did read the legal pack and seen the clause but was 50/50 on wither I would have to pay it or not and factored it into the price anyway.
Thought maybe the 2 year vat rule would apply but apparently not.

discodavie

Two rules, the two and five-year rules, determine if a property is “new” –
• The first supply of a completed property within five years of its completion is
considered to be the supply of a new property and is subject to VAT.
• The second and subsequent supply of a property is considered to be the supply
of a new property and subject to VAT but only if it takes place within two
years of occupation.

Dexterd

Yes that's what I thought the vat rule was, the property I bought was 5 years and a few months old so I thought I should be ok without paying the vat? But my solicitor said that I had to. Is there anybody with experience of this that can help?