Home  5  Books  5  GBEzine  5  News  5  HelpDesk  5  Register  5  GreenBuilding.co.uk
Not signed in (Sign In)

Categories



Green Building Bible, Fourth Edition
Green Building Bible, fourth edition (both books)
These two books are the perfect starting place to help you get to grips with one of the most vitally important aspects of our society - our homes and living environment.

Buy individually or both books together. Delivery is free!


widget @ surfing-waves.com




Vanilla 1.0.3 is a product of Lussumo. More Information: Documentation, Community Support.

Welcome to new Forum Visitors
Join the forum now and benefit from discussions with thousands of other green building fans and discounts on Green Building Press publications: Apply now.




    • CommentAuthorgoodevans
    • CommentTimeMay 17th 2017
     
    I thought I would seek some advice here before approaching the authorities.

    I have a single site with an application for planning permission for two dwellings – one for me and my wife, one for my parents.

    Any works that take place on site will probably be for both buildings as a single contract (and ideally I don’t want to have to ask contractors or suppliers for 2 invoices for each dwelling).

    As I understand it the VAT rules allow me to claim back as self-build for a house that is built for me or my family so if all the invioces came to me in my name there should not be any problem reclaiming (there would be two claims but the VAT people would accept that I could apportion the VAT between the two dwellings in any way that is reasonable and fair).

    CIL excemption on the other hand is based on the individual – So I have some issues that I can see:

    My father (or mother) would have to commission the build – if they commission me to do it would the VAT people think I was a building firm.

    Part 2 (of form 7) of the CIL exemption needs to see evidence that it is a self-build and if I don’t get a LABC warrantee or equivalent, or a self-build mortgage (which I don’t need) the only remaining evidence is a successful VAT reclaim. There are two problems here – a) what if the VAT claim is not decided before the 6 month CIL deadline. And b) The CIL application is in the name of my father or mother but the VAT reclaim on their dwelling is in my name – would the CIL application fail at the last hurdle.

    If the CIL application is in one of my parents’ names and they die before completion - does the CIL exception fail and become immediately payable, or can the exception be transferred to my remaining parent. If they both die before completion I reckon I’m stuffed – but would I be stuffed if the CIL applicant (or both) die within the 3 years that the house has to remain as their principle residence.

    I know it is possible to ask the VAT people for advice and they will honour their response. What are the chances that I could get responses from my local authority (collecting authority) that I can hold them to.
    • CommentAuthortony
    • CommentTimeMay 17th 2017
     
    Local authority will no way want to let you off CIL, will be fight and I can't see you winning sadly.

    VAT is a given as it is set in statute law, they have to give you what is due back, it should not be slow but you will need to choose submission date carefully, probably just before the end of buying but after sign off.
    •  
      CommentAuthordjh
    • CommentTimeMay 17th 2017
     
    Posted By: goodevansPart 2 (of form 7) of the CIL exemption needs to see evidence that it is a self-build and if I don’t get a LABC warrantee or equivalent, or a self-build mortgage (which I don’t need) the only remaining evidence is a successful VAT reclaim. There are two problems here – a) what if the VAT claim is not decided before the 6 month CIL deadline. And b) The CIL application is in the name of my father or mother but the VAT reclaim on their dwelling is in my name – would the CIL application fail at the last hurdle.

    I don't know much at all about CIL - my build just predated its application in our area (thank my lucky stars).

    I think the answer to your question (a) would be that its very unlikely to take that long and if it did I would think that natural justice would require them to allow an extension until it was completed (assuming you had applied, of course). But that's just a guess although:

    "The only exception is where the claimant of the exemption fails to comply with the evidence requirements on completion. In such cases, the collecting authority must give the claimant at least 28 days to submit the necessary form and evidence before taking any further action." *

    Your father and mother will presumably need to own the materials in their house, so won't you need to transfer the materials to them somehow if you buy them? It might be easier to deal with the hassle of separate invoices in the first place?

    It sounds like you are a (very small) community development and need to treat it that way, whatever that implies. Or perhaps you are building a house and an annexe? It sounds like the sort of technical issue that others will have dealt with already.

    If the CIL application is in one of my parents’ names and they die before completion - does the CIL exception fail and become immediately payable, or can the exception be transferred to my remaining parent. If they both die before completion I reckon I’m stuffed – but would I be stuffed if the CIL applicant (or both) die within the 3 years that the house has to remain as their principle residence.

    I think that it will be better to have both parents apply for their exemption, so one dying won't affect it. If both die within three years, I'm not sure whether that triggers liability or whether their estate would have to sell the house within the three year period. I suspect the council would want its pound of flesh.

    * https://www.gov.uk/guidance/community-infrastructure-levy#Self-Build-Exemption

    PS It might be worth asking at https://khub.net/web/planningadvisoryservicepas/forum/-/message_boards/message-boards-home
    • CommentAuthorCWatters
    • CommentTimeMay 17th 2017 edited
     
    As I understand it the VAT rules allow me to claim back as self-build for a house that is built for me or my family so if all the invioces came to me in my name there should not be any problem reclaiming (there would be two claims but the VAT people would accept that I could apportion the VAT between the two dwellings in any way that is reasonable and fair).


    If you employ a VAT registered builder to do all the work then he should not charge you VAT anyway, not on labor or materials. So there will be no VAT for you to reclaim. That would be the simplest route.

    If you buy some materials yourself (eg the kitchen) and get the builder to fit them then you can reclaim the VAT on those using the Self Build VAT Reclaim scheme. The invoice must be in your name(s).

    However: The Self Build VAT reclaim scheme is only for people building a house to live in themselves and you cannot live in two houses at once!

    So either get the builder to buy all the materials, or you buy yours and your parents buy theirs and you submit two separate VAT reclaims.

    You will need to make two applications for exemption from the CIL. This must be done _BEFORE_ any work starts on site. So no site clearance or tree felling in preparation. You must follow the rules on the form and reproduced below to the letter or they will charge you..

    https://ecab.planningportal.co.uk/uploads/1app/forms/form_7_self_build_part_1_exemption_claim.pdf

    An exemption for a self build home must be granted prior to the commencement of the development AND a Commencement (of development) Notice must be received by the Charging/Collecting Authority prior to the date of commencement of the development.

    The applicant will otherwise be liable for the full levy charge.

    Part 2 of this form must be submitted to the Charging/Collecting Authority within six months of the completion of the development.

    The applicant will otherwise be liable for the full levy charge.



    Get it all in writing. Ask the council to confirm receipt for everything. Send everything recorded delivery etc.
    • CommentAuthorCWatters
    • CommentTimeMay 17th 2017
     
    Re Death and the CIL...

    All I could find is this...

    http://www.legislation.gov.uk/uksi/2010/948/regulation/39/made


    Effect of death on assumed liability

    39.—(1) This regulation applies where a person (P) who has assumed liability to pay CIL in respect of a chargeable development dies before the chargeable development is commenced.
    (2) P’s assumption of liability ceases to have effect.
    (3) A person may assume liability to pay CIL in respect of the chargeable development before it is commenced.
    (4) An assumption of liability under paragraph (3) must be made in accordance with regulation 31; but for the purposes of that regulation as it applies to this paragraph, an assumption of liability notice is not valid unless it is accompanied by P’s death certificate.


    http://www.legislation.gov.uk/uksi/2010/948/regulation/37/made


    Joint liability

    37.—(1) Where two or more persons are joint owners of an interest in land they shall each be jointly and severally liable to pay any CIL payable in respect of that interest.
    (2) Where two or more persons have assumed liability to pay CIL in respect of a chargeable development they shall each be jointly and severally liable to pay any CIL payable in respect of that chargeable development.


    and

    http://www.mills-reeve.com/files/Publication/6c401a7d-6ad6-47b1-a0f6-529ead8ecd51/Presentation/PublicationAttachment/ac86bf66-c837-400a-ba3e-57cc4677c6ad/CIL_Apr10.pdf


    Death will cancel an assumption of liability where the person dies before commencement of development. In those circumstances the landowner will become liable.
    • CommentAuthorgoodevans
    • CommentTimeMay 17th 2017
     
    Thanks for the replies - I'll be going through this over time but I have these comments so far.

    I need the VAT relaim to prove that it is a self build for the CIL form 7 part 2 - so I and/or my parents will be buying something (e.g. a door or a brick) directly for each dwelling. In any case I may be sourcing materials directly rather than a builder - it all depends on the builder(s).

    VAT reclaim allows a claim for "New builds. Creating a new dwelling built from scratch, providing it is to be used by you or your relatives as a family home for residential or holiday purposes." I think that the VAT people may struggle with two claims from me at the same time - I can ask them - if not it seems sensible to ensure all invoices are allocated appropriately between the two dwellings.

    I think the community development CIL exemption is for projects such as village halls etc - dwellings can not be part of the community development.

    Tony's suggestion that the local authority will deny me a properly applied for CIL exception is of concern - has anyone failed to get the exception yet followed the (copious) rules/forms correctly?

    Can two people jointly claim the CIL exception - I think not as the form is worded with the singular "I" - unlike the transfer of assumed liability form which has "I/We" all over the place (but illogically only the space for one name).

    In the event that one of my parents dies before commencement we can resubmit if necessary - however between commencement and 3 years after completion I need to find out more.
    •  
      CommentAuthordjh
    • CommentTimeMay 17th 2017 edited
     
    Posted By: goodevansI think the community development CIL exemption is for projects such as village halls etc - dwellings can not be part of the community development.

    Correct, they are 'community development' but they are part of a community development project that comprises a bunch of people who are together developing houses for each of the people to live in. A better example is the shared facilities in a cohousing development, because facilities open to the general public are excluded.

    I still think that describes your situation quite well. There are more concerns than CIL that it affects (e.g. separate or phased planning).

    Can two people jointly claim the CIL exception - I think not as the form is worded with the singular "I"

    I think yes because somewhere I saw a mention of 'person(s)'. Also because of Colin's quote about joint liability. If the form is singular then maybe you need two forms? You definitely need to ask the council and I would suggest also asking a specialist lawyer beforehand.
    • CommentAuthorgoodevans
    • CommentTimeMay 17th 2017
     
    Thanks DJH

    I think I got mixed up between community groups and communal developments - I think that for CIL my parents and my wife and me might be a community group. That may mean a single CIL exemption application and a single VAT reclaim which would seem appropriate for this project. We don't need phased development - both dwellings can start at the same time. I wonder how to create a community group - I've not seen any forms for that.
  1.  
    With regards to CIL I found that the council (Lewisham in London) were quite inexperienced in dealing with a Self Builder, especially at a time when some of the regulations were changing. However, they were helpful and ultimately gave me exemption without any issues. I'd suggest speaking to them and explaining your situation. They will probably help.

    With regards to the evidence I'd question why you would not want a warranty. If you need to sell one or both of the houses within 10 years (which is a long time and a lot can happen in 10 years) then anyone who needs a mortgage to buy the house will need to see a warranty certificate. I don't plan to move, but I got a warranty as I didn't want my biggest asset to be un-sellable. To me it seems like a huge risk not to have a warranty.
    •  
      CommentAuthordjh
    • CommentTimeMay 18th 2017
     
    Posted By: goodevansWe don't need phased development

    I think you do need two CILexemptions and you do need phased planning. The point is that if it's all on one ticket then if the criteria for either property fail (e.g both parents die, FSM forbid) then CIL is due for the whole project. If they are separate, including the planning permission, then only the house that's affected becomes liable for CIL.

    I don't know how to set up a community group either. I suppose some time searching is in order.

    I also agree with both of Richard's points. I went for an architect's cert rather than a warranty as that was easier.
    • CommentAuthorCWatters
    • CommentTimeMay 22nd 2017 edited
     
    It seems in Bedford you don't have to send a valid VAT reclaim as there are other choices...

    https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&ved=0ahUKEwicvvL_loTUAhXHLsAKHUH8BYEQFgg3MAE&url=https%3A%2F%2Fwww.bedford.gov.uk%2Fenvironment_and_planning%2Fplanning_town_and_country%2Fplanning_policy__its_purpose%2Fidoc.ashx%3Fdocid%3D16cf8476-9150-474e-91f5-6c887a899e54%26version%3D-1&usg=AFQjCNFs84aPBI9ML5IAj_jwOgxa0duD4g&sig2=vJx1x2fpmH2xOaoNGKY2ag

    <blockquote>
    In addition to the above you must provide a copy of one of the following

    An approved claim from M Revenue and Customs under VAT431C: VAT returns for DIY housebuilders,
    a Specialist Self Build or Custom Build Warranty for the development
    An approved Self Build Mortgage from a bank or building society.
    </blockquote>

    Perhaps same in other areas?
    •  
      CommentAuthordjh
    • CommentTimeMay 22nd 2017
     
    Posted By: CWattersIt seems in Bedford you don't have to send a valid VAT reclaim as there are other choices.

    Err, did you read where goodevans said he wasn't getting a warranty and didn't need a mortgage?
    • CommentAuthorgoodevans
    • CommentTimeMay 23rd 2017 edited
     
    It is worth noting that the guidence asks for a VAT431C, however the Form 7 part 2 form asks for a VAT431NB.

    The C being 'Conversion' and the NB being 'New Build'. The VAT431NB would be the only VAT claim available to me - it seems to me that the guidance note is inaccurate.
    •  
      CommentAuthorfostertom
    • CommentTimeJun 5th 2017
     
    Posted By: goodevansseems to me that the guidance note is inaccurate
    That often happens - it's worth having a phone conversation with VAT Head Office and asking that it be a recorded numbered conversation, which may then be referred to, is binding and may over-rule the guidance note (for better or worse!).
Add your comments

    Username Password
  • Format comments as
 
   
The Ecobuilding Buzz
Site Map    |   Home    |   View Cart    |   Pressroom   |   Business   |   Links   
Logout    

© Green Building Press