For once, good news emanating from HMRC, who have just re-written their internal guidance on the topic of construction – their reference V1-8A. Within it, they state that double glazing and secondary glazing can, potentially, be zero rated as alterations. This is wonderful news as they have hitherto refused to accept zero rating, except in very limited circumstances.
To recap – the work would have to be carried out on a listed qualifying building, be subject to Listed Building Consent and be an “alteration”. Dictionary definition – “make something different, change”. Their narrow view, thus far, is that it simply isn’t an alteration. In fact, in a recent case that, as far as I know, is still heading for the First Tier Tax Tribunal they maintain that it is “repair and maintenance of the building as a whole”. I’ve found a dictionary definition of “repair” and find “…restore to good condition after damage or wear..” I think not.
It’s difficult for me to lose my natural cynicism, and as a result I have emailed HMRC to ask them if they really mean it.
Watch this space.
Update 9 November2011: HMRC didn’t cover themselves in glory, with their response.
I asked “Does it mean what I think it says?”
“Thank you for your enquiry dated 20 October 2011. I understand that your query relates to work to a listed building.
HM Revenue and Customs will only provide a ruling (Clearance) if after consulting the relevant guidance there is demonstrable uncertainty about how a transaction should be treated. Guidance on how to apply for a Clearance is available via the HMRC website www.hmrc.gov.uk, at the following address: http://www.hmrc.gov.uk/cap/links-dec07.htm”
Not immensely helpful, but I persevered and received something that would pass, in a dim light, as a reasonable answer:
“I can confirm that HMRC policy has not changed, each case is considered individually and as long as all the conditions have been met in relation to altering the fabric of a listed building zero rating can be applied.”
I have a couple of letters on file from HMRC, last year, in which they state that double glazing and secondary glazing are NOT regarded as alterations so I’ll leave you to decide whether anyone is being economical with the truth.