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HMRC internal manual

VAT Construction

Zero-rating the construction of buildings: about this section

This section provides guidance on when services supplied in the course of the construction of a building can be zero-rated.

The zero rate applies to services supplied in the course of constructing buildings that are:

  • ‘designed as a dwelling or number of dwellings’ (VCONST14100)
  • intended for use solely for a ‘relevant residential purpose’ (VCONST15000)

or

  • intended for use solely for a ‘relevant charitable purpose’ (VCONST16000).

There are occasions when the construction of a building may be apportioned between what is zero-rated and what must be standard-rated (VCONST02800).