Readers’ forum: Coronavirus crisis

One of my clients purchased the freehold of an office block in January for £200 000 plus VAT and then spent £60 000 plus VAT on improvement works. It was intended to be used solely by company employees and the business is fully taxable so input tax was claimed on all costs.

The employees were due to move into the building in March but this was put back because of the coronavirus crisis and employees have been working from home instead so the office has been empty since it was purchased. VAT returns are completed up to the end of January April July and October.

My question concerns VAT. As a result of the coronavirus crisis and the redundancy of some employees plus home working the client has agreed to sublet the top two floors of the building (there...