VCONST03530 - Zero-rating major interest grants in buildings: 바카라 사이트˜person constructing a building바카라 사이트™: grants in building land

Building land is land on which no building work above foundation level has started. Grants in building land are not grants by a 바카라 사이트˜person constructing a building바카라 사이트™ and are not zero-rated.

The case of Stapenhill Developments Limited (VTD 1593) has confirmed this. The Tribunal stated:

In our judgment [the composite expression 바카라 사이트˜person constructing a building바카라 사이트™] are qualifying words which require that a building must be seen to be under construction on the land before the builder can take advantage of the zero rating provisions of item 1바카라 사이트¦ The composite expression consists of a noun 바카라 사이트˜person바카라 사이트™ to which is appended an adjectival qualification 바카라 사이트˜constructing a building바카라 사이트™. Unless the words 바카라 사이트˜constructing a building바카라 사이트™ are to be considered superfluous some meaning must be attributed to them as an adjectival qualification and it is for this reason that we consider that the composite expression requires that a building must be seen to be under construction on the land.

The Tribunal gave a similar decision in Monsell Youell Developments Ltd (VTD 538). In cases where the grant was in a site where site clearance and other preparatory work had been carried out similar decisions have also been given, namely:

  • Permacross Ltd (VTD 13251)
  • Cameron New Homes Ltd (VTD 17309).

It had been HM Revenue & Customs (HMRC) policy to treat the grants in serviced building plots (land on which no start to the construction of the actual buildings has taken place but with infrastructure installed on the site or in close proximity) as two supplies by the grantor:

  • one of exempt land
  • one of standard-rated civil engineering services.

Following the decision in Douglas and Sonia Virtue t/a Lammermuir Game Services (VTD 20259), we accept that there is only one supply, that of exempt land.

Please note however that the Tribunal went on to find that the supply to the grantor of civil engineering services was zero-rated as a supply in the course of construction of 바카라 사이트˜buildings designed as dwellings바카라 사이트™.