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HMRC internal manual

VAT Construction

Zero-rating major interest grants in substantially reconstructed ‘protected buildings’: about this section

This section provides guidance on when major interest grants in substantially reconstructed ‘protected buildings’ are zero-rated.

‘Protected buildings’ is a VAT term and doesn’t include all listed buildings. VCONST08200 provides further explanation of this. The zero rate only applies to the first major interest grant in buildings that, after the reconstruction, are:

  • ‘designed to remain as or become a dwelling or number of dwellings’ (VCONST14300)
  • 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 supply must be apportioned. VCONST10800 provides guidance on this.