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5 & 6 BAILEY COURT
COLBURN BUSINESS PARK
Estate Agency Offices are located in
BARNARD CASTLE, BOROUGHBRIDGE & RICHMOND
Residential Management Team
On 1 October 2012, HMRC introduced changes to the VAT liability for suppliers of storage facilities following changes in the Finance Act 2012 and an information sheet was released by HMRC in August this year detailing the changes.
These changes may have an impact on rural businesses and we recommend that landowners letting space for storage seek professional advice as soon as possible in order to rectify any potential tax liability that will be backdated to October 2012.
In summary, anybody that has a VAT Registered business that is letting buildings for storage must now charge VAT on the rent, regardless of your position of opting to tax the land itself. The VAT status applies to all goods stored in a ‘relevant structure’ and includes those renting to storage companies. There are a number of small exceptions that may protect farmers such as the exception of live animals, however, this does not except all agricultural activity. The VAT is also not applicable to those that store as an ancillary activity to the normal business activity, but only to a certain degree.
We believe that there are a large number of rural businesses out there that may be liable for unpaid VAT, as a result of these changes, for sub-letting buildings to store grain, hay or other general storage.
For further information or if you are concerned about your VAT position on this, please contact Will Parker in the North Durham office on 01207 529663 or email on firstname.lastname@example.org.