Navigating VAT on Construction Services With instability continuing in the housing market, many people are considering staying put and making renovations to their home. But is there a difference to the end-user when it comes to using Contractors or Sub-Contractors?
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Paula Mason, our VAT Manager compares the VAT treatment of construction services supplied to an end user by a Contractor using the services of Sub-Contractors - to the same services being supplied directly by the Sub-Contractors to the end user.
Building Company
Made up of separate quotes from each of the following:
A quote for all the services required for an all-inclusive price of £25,000 plus VAT.
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Builder B for £18,000 plus VAT
To make this comparison let’s consider the following scenario:
They are a VAT registered Contractor using VAT registered Sub-Contractors.
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Electrician A for £3,000 plus VAT
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Plumber A for £2,000 plus VAT
Mr Smith has obtained planning permission to extend his home. He has received two different quotes:
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Painter and Decorator A for £2,000 with no VAT
All of these quotes are addressed to Mr Smith directly.
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