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Is there any clawback of reclaimed VAT on a change of letting type?
My client purchased a cottage last year. The property needed repairing and renovating to make it totally habitable. At the time it was not certain whether my client would live in it or let it. However the plan is now to let the property as a furnished holiday let (FHL). My client is fully aware of the criteria because he has let a similar cottage in the past.
Will the client be able to reclaim any of the VAT suffered on the renovation and repair expenditure (probably a mixture of builders’ and do-it-yourself costs) that he has incurred if his plan is to go down the FHL route? If so can this be done now or should he wait until the property is on the letting market and make the claim then on his first VAT return?
Although the client has a VAT-registered farming business I...
