Our recent case study demonstrates how much it pays to instruct tax advisors with expert VAT knowledge. At Williamson & Croft, we work with many clients who require property accounting or construction accounting services to help them structure their tax to their best advantage. 

Here’s how we helped one of our latest clients save hundreds of thousands in VAT on their property refurbishment.

The client

The client was an individual buying a residential property in London for a purchase price of £8.5 million and refurbishing it before it was to become their main residence. Their project manager reached out to us with a query around the rate of VAT and subsequently the VAT payable on the refurbishment. 

Their VAT status before our involvement

This client came to us to advise on the VAT they were paying on a property which had been empty for some time and needed refurbishing. The total refurbishment costs were £1.5 million. At the current VAT rate of 20%, that meant a significant VAT cost of £300,000. As the client is purchasing this as an individual and it’s their main residential residence, there is no option to reclaim this VAT, it is in essence an extra cost to them. Understandably, they wanted to explore whether they could benefit from any VAT relief.

Williamson & Croft’s outcome 

As the property had been empty for over 2 years we were able to reduce the VAT on their renovations down by more than £200,000. 

How did we achieve this?


In the UK, VAT on refurbishments can sometimes be reduced in specific circumstances. Williamson & Croft reviewed the status of the property and the planned works against HMRC legislation to confirm it met the conditions for the reduced rate. 

We then reviewed the clients expenditure on a line by line basis to confirm which items qualified for the reduced rate. This also allowed us to complete a feasibility calculation, to assess the benefit of creating a JCT agreement with the main contractor. 

The standard VAT rate is currently 20%. Here are the possible reductions and their requirements:

Reduced rate VAT of 5%:

The reduced VAT on refurbishments is possible under these provisos: 

  • Certain energy-saving materials and installations.
  • The renovation of a property that has been empty for 2 years or more.
  • Conversions of non-residential buildings into residential use.

It’s important to remember that even in these cases there are often caveats which have to be met in order to benefit from this reduced rate.

Reduced rate VAT of 0%:

The zero-rated VAT on refurbishments is possible in these circumstances:

  • New build construction of residential properties.
  • Some conversions, such as a non-residential building into a home.
  • Certain types of building work for disabled people.

Again – It’s important to remember that even in these cases there are specific criteria that must be met to qualify for the zero rate, and professional advice is often necessary to ensure compliance.

Buying a property or assisting someone to do so?

If you’re buying or renovating a property, there will likely be taxes to pay. Consulting experienced tax accountants with intricate knowledge of HMRC’s tax relief schemes can help you or your clients to make the most of them. As the client in this case study found out, a simple consultation with Williamson & Croft helped them to save hundreds of thousands they would have otherwise paid.

Reach out to our property tax experts to chat

We’re here to help if we can. Reach out for a consultation with our team of expert accountants in Liverpool and Manchester who’ll be happy to talk through the particulars of your case. With zero obligation to instruct our team following our consultation there really is everything to gain and nothing to lose.

Get in touch with the team at Williamson & Croft today.

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