Building contractors and VAT.

Moggaman

I’m just curious. A building contractor can claim back the VAT on materials. He builds a house, and presumably doesn’t pass on the Vat to the client but because his services are at 13.5 % , the govt get the 13.5% VAT?. Say cost of house is 300k plus 13,5…the govt get 13.5?.

Now as a self builder, by self builder , I mean project managing and subbing out different elements of the build to different contractors … I wonder is self building a folly?. I am paying 23% on all materials and am paying the 13.5% to each contractors coming in…

in the uk, I believe the Govt give a tax rebate on materials to self builders..

now, people still say you will save by doing a self build, but if you do (presuming you are not a chippy or plasterer etc), then doesn’t it point to the fact the vast profits are being made by builders on individual houses???

I am doing ok budget wise.. about 2/3 through.. so I’m not giving out… just teasing this out in my head…

Moggaman

Now before you say , ‘sure aren’t u paying cash to everyone’… the answer is no.. I’d like to but they are generally tax compliant..

eusap

The real question, is more than 2/3 of the cost of the build for materials, if yes then the contractor should charge 23% VAT on there bill