As a direct result of the COVID-19 pandemic a significant number of workforces have vacated their offices to work from home. Some business models have been altered to allow working from home to continue once restrictions are lifted.
We have noticed an increase in the number of commercial property purchases as a result of businesses downsizing. The vacant buildings are being purchased with the intention of converting them into residential spaces.
Conversions can potentially benefit from a reduced VAT rate on 5% or works which relate to converting the spaces to residential use.
Depending on its place in the construction chain, an entity can increase its cash flow by up to 15%.
VAT is a complex area and to avoid unnecessary costs and enquiries from HMRC advice should be sought as early as possible.