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A previously VAT-registered client bought a derelict commercial property and converted it into four flats and a shop, all of which will be let out
One of our clients sold his business and shop about two years ago. That business was VAT-registered but registration ceased on sale and he now lives off rental income from other properties.
About five years ago he bought a derelict property which had previously been used as a commercial building. Since then he has spent a lot of time and money converting it into four flats and a shop. The conversion process is now almost complete and he is intending to let the flats and shop.
The client believes that he can claim back the VAT on the building materials that have been used because the property was derelict but I think that this applies only if he intended to live in the property himself which he does not.
Just to add to the problem the builders who undertook some of the work are refusing...
