Vat on sale of Holiday home (Tax based)

[acannydoitji]

I wonder if anyone has experience of this or can offer guidance.

I am selling a holiday home I have owned for 5 years. At the I purchased I registered for VAT & reclaimed this. I will be selling with the lease in place so there is no disposal on this and therefore no vatable interest. Does anyone know if I am liable for a clawback of the vat claimed on the original purchase price.

I have a call in to my accountant and am well aware of the complexities of the situation so won't be treating whatever replies as gospel/advice, but nevertheless will welcome all replies.

 

[bazermc]

I will be selling with the lease in place so there is no disposal on this and therefore no vatable interest.

You will be liable to a clawback equal to the VAT reclaimed less what was paid over on the rentals.
This method was recently shut off by Finance Act 2007 as the Revenue perceived it as being an interest free loan, which it is technically.

The sale of a freehold title is an interest and a VATable interest. If you claimed the VAT back on acquisition then it seems very likely that the property is still in the VAT net and therefore VAT should be charged on the disposal.