A Comprehensive VAT Guide for Commercial Property

The General Rationale of VAT

• Structure of VAT law and general principles
• Basic rule ‘unless’ an alternative treatment applies; the Courts’ view on interpreting exemptions and exceptions from exemption
• Obligations vs entitlements; the very different legal and procedural aspects
• HMRC’s powers to challenge a VAT treatment - output tax and input tax issues

The VAT Exemption for Commercial Property

• The scope of the exemption and evolution through the Courts
• Interest in, right over or licence to occupy land
• Grant, surrender and reverse surrender, what is the supply and who is making it?
• This commercial property and VAT course explores sale & leasebacks (or lease & leasebacks) 
• Freeholds, leaseholds, lettings and option agreements
• Barter transactions
• Specific types of property excluded from the exemption

The Election to Waive Exemption (the ‘Option to Tax’)

• Investment vs. development?
• Why Opt to Tax?
• The two-stage legal process, procedures and conditions
• Impact of Opting to Tax, legally binding, ‘cooling-off’ period & revocations
• Where the Option to Tax has no effect
• The power in the hands of a prospective buyer/tenant that can kill a deal
• VAT for commercial property training assesses grant, surrender & reverse surrender
• Air rights & rights to light, whose Option to Tax?
• Overage

VAT Registration Issues

• Types of entity - company, LLP, LP, partnership, trust
• The concept of ‘Establishment’ and different VAT rules for non-resident businesses
• Acquisitions, sales, lettings
• Legal and beneficial ownerships
• When must you or can you register for VAT
• When you may want to register for VAT earlier than the law requires
• Effect of VAT registration on sales, lettings, suppliers and customers

Place of Supply of Services

• Basic rules and special conditions for property related services
• Reverse charges

Landlord & Tenant Issues

• This commercial property and VAT course covers the surrender or termination of a lease
• Tenant inducements
• Tenant fit-out works
• Lease variations
• Service charges

Partial exemption & the Capital Goods Scheme

• Basic principles of partial exemption
• Specific issues for property businesses
• The effect of the Capital Goods Scheme (‘CGS’), advantages and disadvantages

Share Sales vs Asset Sales

• The supplies for VAT purposes
• Different VAT treatments and the effect on supplier & customer

Transfers of Going Concerns (‘TOGC’)

• What is a TOGC - legally and commercially?
• Obligations for transferors and transferees?
• This commercial property VAT workshop addresses when respective interests do not coincide
• HMRC’s powers to challenge the VAT treatment

Redcliffe’s commercial property and VAT courses are led by a highly experienced VAT expert, who brings over four decades of expertise in Indirect Tax. With a distinguished 41-year career, including 10 years at HM Revenue & Customs and more than 30 years advising clients in the accountancy sector, he most recently served as VAT Partner at Blick Rothenberg.

Qualified as a Chartered Tax Adviser in 1995, he has extensive experience helping businesses navigate complex VAT issues. His leadership roles have included chairing the Indirect Tax Sub-Committee of the Chartered Institute of Taxation and serving as a Council member of the VAT Practitioners Group.

While specialising in VAT for land and property, his expertise also covers various VAT areas, including financial services, partial exemption, international supply chains, and inward investment into the UK. Additionally, he has a strong track record in resolving disputes with HMRC, helping clients navigate and resolve complex VAT challenges.

Outside of delivering first-class commercial property VAT training, the trainer’s interests include playing bridge, classic cars, and restoring vintage furniture.

This VAT for Commercial Property masterclass is designed to help you understand the key VAT issues when buying, selling, developing, or letting commercial property.

The course offers a comprehensive examination of contractual issues that often impact the VAT position, highlighting how the substance of a situation—rather than the form—can lead to significantly different (and often unfavourable) VAT outcomes. The goal is to equip participants with the knowledge to not only determine the correct VAT treatment for the transaction but also to identify potential issues before they arise.

When appropriate, the course will examine VAT treatments from the perspectives of sellers, buyers, landlords, tenants, agents, and other relevant parties. While the primary focus is on understanding your own VAT position, this commercial property and VAT course also aims to provide a deeper understanding of the potential implications for other parties involved, helping you prevent commercial disputes before they occur.

This VAT for Commercial Property training course provides an in-depth look at the VAT rules, including the scope of the VAT exemption and when it applies or doesn’t apply. The course covers various commercial transactions and explores the evolving interpretation of VAT law in the Courts, using real-world transaction examples and scenarios to illustrate key points. Attending this course will make you aware of potential pitfalls, as even the smallest details can cause issues for either the supplier, the customer, or both.

The advice provided by advisers can vary depending on whether they are representing the supplier or the customer, and the optimal solution is unlikely to be the same for both parties. Commercial Property and VAT training examines VAT treatments from the perspective of all parties involved in a transaction, incorporating relevant case law where appropriate, as well as considering commercial documentation such as contracts, invoices, and record-keeping.

This commercial property and VAT course is an essential part of developing knowledge for:

Tax and legal professionals advising clients on the VAT treatment of transactions. It is particularly beneficial for advisers specialising in direct taxes or contract law, where VAT may not be their primary focus. Gaining an awareness of VAT issues will not only broaden their expertise but also help identify potential conflicts between the various disciplines.

Management or ‘in-house’ staff in the property industry for whom an awareness of VAT issues will inform the initial plans for a development or new venture not least the early negotiations with suppliers, customers and counterparties.

Tax compliance staff looking to expand their knowledge and engage in more informed discussions with clients will find commercial property VAT training highly beneficial.

Redcliffe Training’s Commercial Property and VAT course provides a detailed look at the VAT treatment of commercial property investment, development, and business transactions. The course examines the VAT position of various example transactions from the perspective of all parties involved, covering key issues such as contractual terms, HMRC challenges, and the evolving case law in this area.

Where applicable, the course also addresses the VAT compliance and reporting obligations that arise from day one, highlighting the distinct differences in reporting compared to direct taxes.