VAT and buildings

If you are considering whether to enter into a sale and leaseback arrangement to fund the cost of acquiring or constructing a new building that you intend to use for:

  1. a relevant charitable purpose, or
  2. a relevant residential purpose, for example a care home

A judgment given on 31 March 2021 by the Supreme Court should be very good news. The issue was whether a self-supply VAT charge in excess of £800,000 arose when a sale and leaseback arrangement was entered into in relation to a new care home with a price in excess of £4,000,0000. The Supreme Court decided that the sale and leaseback arrangement entered into did not trigger the self-supply VAT charge HMRC had wanted to impose.

For information about Garbutt + Elliott LLP VAT services please contact Naveen Sahney or Alex Millar at