UK property: VAT “option” to tax


A buyer of UK property can “opt” or elect to charge VAT in respect of income earned or to be earned in respect of the property.  Once such an option is exercised or election made, it stands for a number of years.

Under the option the buyer must charge output VAT in respect of taxable supplies made in connection with the land or property such as leasing or renting it out, performing catering services on the premises or granting shooting rights over the land.  The buyer can, at the same time, recover input VAT on expenses incurred in connection with the land or property.  Expenses can include fees charged by lawyers, architects, surveyors accountants or other advisers and also on building materials and other such costs.

VAT “option to tax” is a complex area and proper advice should be obtained in advance of undertaking the transaction.  RKG Consulting will be pleased to advice on exercising VAT “option to tax” and also to handle all aspects of the application to be made to HMRC.


RKG Consulting provides tax, immigration and accounting solutions. Our principal adviser is a "Chartered Tax Adviser" and is also an OISC-licensed immigration practitioner. We can provide a seamless service incorporating both tax and immigration solutions. If you have any queries, please feel free to contact us by telephone: +44 207 839 0389
Contact us by email: contact@rkgconsulting.com or use the form below.

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