Builders VAT Rules Delayed for a Year

Date posted: 16th Oct 2019

The government has decided, to delay the start of the proposed VAT reverse charge for supplies, by sub-contractors, in the construction sector.

The reason for the u-turn, is the lack of awareness of the change, which was originally due to start on 1 October 2019. Many subcontractors and some main contractors were not prepared for the changes, on top of getting to grips with Making Tax Digital for VAT and consequently the government has decided to delay the start of the new rules, for 12 months.

It has also come to light, that some of those sub-contractors using the VAT flat rate scheme would be worse off, which will require a review of whether that scheme is still worthwhile for them.