Readers’ forum: Refurbishment dilemma

17 November 2020

Issue: 4769 / Categories: Forum & Feedback

Taxation issues on the redevelopment of a building.

My client bought a building 20 years ago for about £25 000. Until the lockdown it was used as a venue for martial arts meetings and is currently in a poor state of repair. The building is now in a prime location for redevelopment into flats. A developer has approached my client with an offer to modernise the martial arts venue and build flats on the three floors above the present studio. As part of the agreement the developer has offered that one of the new flats would be transferred to my client.

My client is not registered for VAT and does not want to have to do so. This would suggest that there is an issue with the cost to the builder of the refurbishment of the venue. Is this correct and how should this be best approached? And is there an equivalent issue on the...

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