Zero Rated Property Sales

cobbles Registered Posts: 30 Regular contributor ⭐
Hi I have a new client with incomplete records they trade as property developers they have been developing two sites in both cases they have not been claiming input vat on any purchases relating to the development on either site - they have been using another building company who are vat registered but still no input vat has been claimed, one property was sold last October(£250,000) but due to poor bookkeeping a nil return was submitted and another property was sold for £900,000 recently and should now be recorded.

I recorded the sales in to the accounting package as a zero rated, when I run the vat return it picked up the prior sale form October and the current sale from this last quarter in the figures in box 6 but it looks distorted on the return.

I have spoken to the director (as is he is supposed to know his taxable supply) but he keeps putting me off, the return needs to be submitted now ( it is for a small refund)

Does anyone have any advice?


  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
    Firstly, residential property are zero rated. A developer can opt to tax and you need to check whether they are indeed registered for this. I would say that, in the first instance, you need to check their VAT status.
  • cobbles
    cobbles Registered Posts: 30 Regular contributor ⭐
    Thanks for your reply

    I have submitted the return now, I phoned the AAT business Support helpline they gave very good guidance, whether the properties were exempt or zero rated it needed to be shown on the return, and a letter sent to HMRC for the sale not disclosed in the earlier return.
Privacy Policy