Selling Your Land For Housing Development - VAT Considerations

VAT is one of several taxes that need to be considered when selling development land. It is important that you take early advice, and that all necessary steps are carefully implemented.

Your advisors need to liaise closely, as any change to the structure or timing of the deal needs to be reflected in the VAT implementation. The key considerations are outlined in this article. VAT treatment of land sales The first issue is whether the seller is already obliged to charge VAT or has the flexibility to choose whether VAT could be charged.

The sale of bare land is normally exempt from VAT, unless the vendor has notified HMRC of a valid “Option to Tax” over the land. A key step in any transaction is to identify whether the vendor has ALREADY Opted to Tax the land being sold.