6 years ago I started a limited company to buy a house for 220k,
I spent 200k converting this into 3 flats.
I recently sold one of these flats for 144k.
I divided purchase cost into 3 and with development costs made a loss of 3 k.
My accountant has suggested that I need to register for VAT because this transaction has put me over the £85,000 threshold. She also informs me that I will have to pay VAT on the total turnover. As I did not charge the seller VAT I’m surprised she has requested this?
Does this make sense to anyone?
Get a second opinion from one of the landlord tax specialists that advertise.
Thanks David, are there landlord tax specialists that advertise on this website or were you thinking of another site? Appreciate your reply/advice
You could try Rita4Rent. They used to be the NRLA tax partner.
Thanks David-I appreciate you taking the time to reply. Best wishes
Sounds like you might need a new accountant! Unless there’s something odd in your situation, you don’t pay VAT on the sale of residential property. Commercial property may be VATable depending on circumstances.