VAT receipts for new builds?

fclauson

SAS - just to clarify my comments

I was just saying that any tax documents upon which you may need to rely upon in the future should normally be kept 7 years

I am not saying if a specific project/engagement/self-build needs them kept or not.

kkelliher

fclauson wrote: »

SAS - just to clarify my comments

I was just saying that any tax documents upon which you may need to rely upon in the future should normally be kept 7 years

I am not saying if a specific project/engagement/self-build needs them kept or not.

I understood it to be 6 six years that you must hold records as a self employed person but I am open to correction

muffler

kkelliher wrote: »

I understood it to be 6 six years that you must hold records as a self employed person but I am open to correction

I know from filling in a form earlier in the week to claim tax relief on dental treatment the receipts are to be kept for 6 years. The way that works is that you claim the amount spent but you DONT send in any receipts. However they do say that the receipts must be retained for 6 years should Revenue wish to examine same.

hexosan

Doesn't seem fair that you can only claim back 4yrs but revenue can go back 6yrs.

kkelliher

hexosan wrote: »

Doesn't seem fair that you can only claim back 4yrs but revenue can go back 6yrs.

I dont think anyone is going to argue that fairness and revenue (well tax) cant be mentioned in the same sentance.

sydthebeat

my reading of it from
http://www.revenue.ie/en/tax/rct/cif-presentations/construction-faqs.html#sectiona6

is that when a main contractor is involved the RCT requirements are carried out by them.

with a self build in effect the self builder is the main contractor therefore is subject to the same tax implications. I cannot find any exemption for the fact that the build is for the main contractors own habitation, but i will chase this up.

kkelliher

sydthebeat wrote: »

my reading of it from
http://www.revenue.ie/en/tax/rct/cif-presentations/construction-faqs.html#sectiona6

is that when a main contractor is involved the RCT requirements are carried out by them.

with a self build in effect the self builder is the main contractor therefore is subject to the same tax implications. I cannot find any exemption for the fact that the build is for the main contractors own habitation, but i will chase this up.

Syd I am sure your correct to be fair and I would be supprised if it was read any differently by revenue.

sas

sydthebeat wrote: »

my reading of it from
http://www.revenue.ie/en/tax/rct/cif-presentations/construction-faqs.html#sectiona6

is that when a main contractor is involved the RCT requirements are carried out by them.

with a self build in effect the self builder is the main contractor therefore is subject to the same tax implications. I cannot find any exemption for the fact that the build is for the main contractors own habitation, but i will chase this up.

This is going to read like I'm foaming at the mouth...

The actual first line of that reference rules out the self builder.

"For RCT to apply, the homeowner must be a principal for RCT purposes i.e. a person carrying on a business which includes the erection of buildings or the development of land, or the manufacture, treatment or extraction of materials for use in construction operations, or a person connected with a person (which includes any individual, company or any unincorporated body of persons) carrying on such a business."

Self builders are not running a business erecting buildings. I'm really struggling to understand where the confusion is arising. The previous link I provided covers the definitions of what makes someone a "principal contractor" and none of it can be applied to the self builder.

Villain

Sas I really can't see the confusion either, self build people are not the same as building contractor! They are not involved in a business.

mickdw

It is crazy to suggest that a homeowner be they building a wall, an extension or a new house would have to behave in the same manner as a building contractor from a tax view point.
To expect a self builder to be aware of the rct procedures and handle the various tax liabilities around this is nonsense.
As far as im concerned, if a self builder or any homeowner has invoices from works completed and record of cheque payment, they must be in the clear.
The rules are pretty clear for c2 registered subcontractors too. When working for main contractor, vat is held by main contractor and paid direct to revenue. When sub contractor works for non registered individuals, he must be paid the vat and return it to revenue as normal with vat accounts every 2 months.
Basically, selfbuilder simply pays subcontractor vat Inclusive figure and thats it.

sas

mickdw wrote: »

As far as im concerned, if a self builder or any homeowner has invoices from works completed and record of cheque payment, they must be in the clear.
.

Disclaimer: I'm not trying to support the concept of the black economy here...

I don't even see why the homeowner needs to produce\retain invoices.

The subcontractor is required to pay the VAT charged to revenue.
The sucontractor is required to charge VAT to the customer.

Why should the customer even need to know about VAT, if I buy a car I don't need to know!

If the subcontractor takes an amount in any legal form (e.g. cash) and it's a final amount where they are not disputing the amount paid over, then the homeowner is in the clear in my view.

Making the customer responsible for the tax affairs of the contractor, is not something that has been legislated for based on my reading of the material.

There may be a case to argue conspiracy to defraud (I think it's called that) but revenue would have challenges proving that.

mickdw

sas wrote: »

Disclaimer: I'm not trying to support the concept of the black economy here...

I don't even see why the homeowner needs to produce\retain invoices.

The subcontractor is required to pay the VAT charged to revenue.
The sucontractor is required to charge VAT to the customer.

Why should the customer even need to know about VAT, if I buy a car I don't need to know!

If the subcontractor takes an amount in any legal form (e.g. cash) and it's a final amount where they are not disputing the amount paid over, then the homeowner is in the clear in my view.

Making the customer responsible for the tax affairs of the contractor, is not something that has been legislated for based on my reading of the material.

There may be a case to argue conspiracy to defraud (I think it's called that) but revenue would have challenges proving that.

I agree with you but it would be wise to retain records of payments.
Back in 2006, the welfare inspectors marched into my self build (without ppe I might add) and introduced themselves as being from revenue and welfare. I was doing a bit of timber work myself. They asked who owned the house, my occupation and who did blockwork and roofing.
Nothing of interest for them as I had registered trades but I can see how they would ask alot more questions nowadays so from homeowners point of view, I would be paying by cheque anyway.
As you say, what the tradesman does after that, is his business.

sydthebeat

When the sub contractor is c2 registered then theres no problem at all. The whole issue here revolves around cases where the sub contractor is NOT C2 registered.

I though that was obvious from the first link I posted?

I'm in no way am expert on this, I'm just giving my interpretation of how I read it.
I'm coming from a cynical view that revenue will do whatever they can to stop black market practises

muffler

Solution: Change name by deed poll to Charles J Haughey. No more tax problems :pac:

martinn123

sydthebeat wrote: »

When the sub contractor is c2 registered then theres no problem at all. The whole issue here revolves around cases where the sub contractor is NOT C2 registered.

I though that was obvious from the first link I posted?

I'm in no way am expert on this, I'm just giving my interpretation of how I read it.
I'm coming from a cynical view that revenue will do whatever they can to stop black market practises

C2, etc are irrelevant, in a contract between a homeowner/ self-builder and a Contractor.

The home owner cannot claim back VAT, and so the only ''Revenue'' related item is VAT charged at the correct rate, on the job as a whole.

In answer to the OP, the Revenue may write to a home builder to insure he/she paid VAT on purchases, or Contracted Projects.
It's to stamp out the Black economy jobbers, and/or guy's who buy goods in the North using a dodgy VAT no.

Villain

sydthebeat wrote: »

When the sub contractor is c2 registered then theres no problem at all. The whole issue here revolves around cases where the sub contractor is NOT C2 registered.

I though that was obvious from the first link I posted?

I'm in no way am expert on this, I'm just giving my interpretation of how I read it.
I'm coming from a cynical view that revenue will do whatever they can to stop black market practises

So if I pay someone to cut my grass and hedges etc and they aren't C2 registered RCT then applies to me?

Because there is zero difference between that and a self build.

martinn123

Villain wrote: »

So if I pay someone to cut my grass and hedges etc and they aren't C2 registered RCT then applies to me?

Because there is zero difference between that and a self build.

No, the guy cutting your grass, charges you for Labour, materials, if used, and the correct rate of VAT, if he is registered for VAT.
C2 is irrelevant.
Same with a self-build

mickdw

martinn123 wrote: »

In answer to the OP, the Revenue may write to a home builder to insure he/she paid VAT on purchases, or Contracted Projects.
It's to stamp out the Black economy jobbers, and/or guy's who buy goods in the North using a dodgy VAT no.

And what happens if home builder writes back with invoices for materials from various suppliers and then says they did the labour themselves? Although they had really paid cash?

martinn123

mickdw wrote: »

And what happens if home builder writes back with invoices for materials from various suppliers and then says they did the labour themselves? Although they had really paid cash?

Well if they say they did say the Electrical, Plumbing labour themselves, I suppose Revenue might ask where/how they qualified/studied as an electrician, or check that they posess the necessary tools to carry out the work.
If the home owner actually works as an Fork Lift Driver he may have a problem.

Villain

There is also an assumption that all labour is paid for, what about friends and family that volunteer?

mickdw

martinn123 wrote: »

Well if they say they did say the Electrical, Plumbing labour themselves, I suppose Revenue might ask where/how they qualified/studied as an electrician, or check that they posess the necessary tools to carry out the work.
If the home owner actually works as an Fork Lift Driver he may have a problem.

Yes electrical is a sticking piont and I know of a builder who got into a bit of a muddle in a tax audit when he had no receipt for electrician.
My point was really relating to ground works blocks, carpentry etc.

martinn123

mickdw wrote: »

My point was really relating to ground works blocks, carpentry etc.

Suppose if you have a JCB in the garage, a cement mixer, and carpentry tools in the shed, you should be OK.

mickdw

martinn123 wrote: »

Suppose if you have a JCB in the garage, a cement mixer, and carpentry tools in the shed, you should be OK.

A jcb would have no business going near site developnent.

martinn123

mickdw wrote: »

A jcb would have no business going near site developnent.

I suppose you dug out the foundations with a shovel.:D

mickdw

martinn123 wrote: »

I suppose you dug out the foundations with a shovel.:D

No. Im talking something more substantial and on tracks.

fairky

DEE Day Revenue came onto my site today and asked everyone for there details.

esox28

fairky wrote: »

DEE Day Revenue came onto my site today and asked everyone for there details.

was it a selfbuild, school, commercial or industrial project?

I was working on a school extension when they got everyone to stand inline and show there pps or vat reg no. Was like being back in the old school days

martinn123

fairky wrote: »

DEE Day Revenue came onto my site today and asked everyone for there details.

Good, did they catch anyone out?

sydthebeat

fairky wrote: »

DEE Day Revenue came onto my site today and asked everyone for there details.

martinn123 wrote: »

Good, did they catch anyone out?

when you say

my site

i will assume you are either the client or the contractor.
Either way i hope you will have the good sense not to answer the above question.

Thank you for letting is know the revenue are proactive in their pursuit of tax dodgers.

mfceiling

Had them on site a few weeks ago (new school build).

The amount of lads running to hide in vans, roof spaces and one lad climbed in to an empty water tank!!

They were very polite to me - asked all the questions - i gave all the answers. The one thing he couldn't figure out was.....he only got about 11 names in total yet the car park had over 25 vehicles in it!!