VCONST03580 - Zero-rating major interest grants in buildings: ‘person constructing a building’: 'person constructing' and VAT groups

If a company within a VAT group is a ‘person constructing’ a building, then zero-rating can only apply to the grant of a major interest in the building to a person outside the VAT group when that company makes the grant.

Note: If a major interest in a building is granted to another member of the VAT group, ‘person constructing’ status is not transferred. But more than one company in a VAT group may have ‘person constructing’ status, for example if one company is the developer of a project and another is the main contractor.

You can find further information on supplies by members of VAT groups in

• VCONST03700
• Section 4.5.3 of Notice 708 Buildings and construction
• the V1-28: Registration guidance - Part 1
• the V1-28: Registration guidance - Part 2A
• the V1-28: Registration guidance - Part 2B.