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HMRC internal manual

VAT Land and Property

Business and non-business: what if the property owner makes infrequent supplies?

One of the criteria to be satisfied under the business test in VAT Business/Non-Business Manual is that the activity is carried out on a regular and consistent basis. A one-off supply or a series of infrequent, unconnected supplies is not normally regarded as a business activity.

However, the VAT Tribunal in David Wickens Properties Ltd (1982) (VTD 1284) decided that where property was concerned, the infrequency of supplies did not necessarily prevent an activity from being treated as a business.

David Wickens Properties Ltd made very few supplies - often with long periods intervening between individual supplies. Despite the infrequency of supplies, the Tribunal held that the activity did amount to a business for VAT purposes. It was stressed that in this type of case all the relevant circumstances should be considered when determining whether there was a sufficiency of supplies.

Given the particular nature of property development, a one-off supply did not preclude it from being business.