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Did the construction of a standalone extension qualify as the construction of a new residential property?

By Andrew Needham, April 2023

This was an appeal against HMRC’s refusal of a claim for a refund of VAT under the DIY House Builders Scheme. HMRC contended that the planning permission was for an extension of the existing building and not for a separate dwelling.  

In July 2019, a Building Control Completion Certificate was issued, which described the relevant works as “construction of a single-storey extension to the rear” of the property connected by a corridor. An informal amendment to the planning permission removed the connecting corridor leaving it as a standalone extension consisting of two bedrooms, a kitchen, and a living room. The appellant moved from the main house and took up residence in the extension while one of his children occupied the main residence. 

The appellant’s evidence was, in summary, that although the initial plan had been for the rear extension to be attached to the existing property, the plans were changed so that it

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