Construction VAT specialists
Cut the VAT on your building projects.
From 20% to 5% or 0%, wherever the law allows. We go through your builder's quote line by line, find where a lower rate applies, and give you the paperwork to prove it.
- Specialism
- VAT on building projects.
- Experience
- Projects with VAT in the millions.
- Fees
- Fixed, and agreed before we start.
What is at stake
Same building work. Three very different VAT bills.
The rate depends on the building and on the work, not on the builder. Move the figure to see what sits between the rates on a project your size.
- Gap between 20% and 5%
- £30,000
- Gap between 20% and 0%
- £40,000
An illustration of scale, not a figure for your project. Whether a lower rate applies, and to which items, is what the analysis establishes.
Line by line
The rate isn't one number. It's decided line by line.
When a project qualifies, the labour and the building materials take the lower rate together. Some items never do. That is why we rate a quote item by item instead of giving one answer for the job.
- VAT as quoted, 20% throughout
- £48,300
- VAT rated line by line
- £16,800
- Difference
- £31,500
Illustration: an office converted into six flats, qualifying for the reduced rate. Example figures, not a quote for your project.
| Item | Net | Rate | VAT |
|---|---|---|---|
| Item 1 | £18,000 | 5% | £900 |
| Item 2 | £64,000 | 5% | £3,200 |
| Item 3 | £31,000 | 5% | £1,550 |
| Item 4 | £27,000 | 5% | £1,350 |
| Item 5 | £14,500 | 20% | £2,900 |
| Item 6 | £9,800 | 20% | £1,960 |
| Item 7 | £7,200 | 20% | £1,440 |
| Item 8 | £48,000 | 5% | £2,400 |
| Item 9 | £22,000 | 5% | £1,100 |
| Total net | £241,500 | £16,800 |
Your project
Which kind of project is yours?
Each type of project has its own rate, its own conditions and its own ways of going wrong.
New build
Building a new home is zero rated, labour and building materials together.
Learn more
Conversions
Most conversions that create or change homes are 5%, labour and building materials together.
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Commercial to residential
Turning an office, shop or pub into homes is 5% on the contractor's work and materials.
Learn more
House into flats
Splitting a house into flats, or merging flats into a house, is 5% where the number of dwellings changes.
Learn more
Barn conversions
A contractor converting a barn into a home charges 5% on labour and building materials.
Learn more
HMO conversions
Converting a house or other building into an HMO can be 5% on labour and building materials.
Learn more
Empty property renovation
Renovating a home that has been empty for two years is 5%, if you can prove the two years.
Learn more
Listed buildings
Alterations and repairs to listed buildings are 20%. Listing itself gives no VAT relief.
Learn moreThe rule most people miss
Is the number of homes in the building changing?
Most people believe the 5% rate only applies to a property that has stood empty for two years. It does not. There is a separate route, and it starts with one simple count.
Homes in the building now
Homes when the work is done
The number changes: 1 becomes 4. That opens a route to the 5% rate that does not depend on the property having been empty. Worth a proper look.
Three ways to instruct us
Start where your project is.
Not sure it qualifies? Begin with the report. Already know it does? Go straight to the line-by-line analysis. The report fee is credited against the analysis, so you never pay twice.
- Tier 1
Qualification report
“Does my project qualify for a lower rate of VAT?”
For anyone at the start of a project: buying a site, weighing up a conversion, or about to go out to tender.
How it works - Tier 2
Line-by-line analysis
“What VAT should be charged on each part of my quote, and can I prove it?”
For clients with a quote or tender in hand who are ready to appoint a builder, and for contractors who need to price a job at the right rates.
How it works - Tier 3
Advisory retainer
“Something has changed mid-build. Does it affect the VAT?”
For developers and contractors already on site, with the VAT position agreed and the job still moving.
How it works
What you receive
Four documents. One defensible answer.
A report that explains the rate, a schedule that applies it to every item, a letter that tells your builder what to charge, and the numbers that show what it is worth.
- 01
Analysis report
A written report setting out which rate applies and why, with the legislation and HMRC guidance cited.
The main document. Proof the work was done properly.
- 02
Materials schedule
A spreadsheet listing every item in the job with its rate and the reason for it.
So the builder knows exactly what to charge on what.
- 03
Contractor letter
A letter you hand to your builder: the rates to use, how to treat materials, what to do about invoices already raised.
Turns the analysis into correct invoices.
- 04
Cost calculation
The worked figures: VAT at each rate, and the difference between what was quoted and what is due.
The number you actually care about.
How it works
From your builder's quote to a clear answer.
You send the quote and we take it from there. What comes back is an answer you can rely on, not just something you were told.
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Step 1
Get in touch
Send us your builder's quote, or tell us about the project if you do not have one yet.
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Step 2
Agree a fixed fee
We confirm what we will do and what it costs, in writing, before any work begins.
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Step 3
We do the work
A specialist reviews your project in detail. If we need anything else from you, we will ask.
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Step 4
You get a clear answer
The right rates, explained in plain English, with the paperwork to back them up.
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Step 5
We stay on hand
We help your builder apply the rates on their invoices and answer questions as the job goes on.
Who you are dealing with
Multi-million-pound projects. High-profile clients. One specialism.
Keystone works on one thing: the VAT treatment of building projects. You get the same care on a single barn conversion as on a scheme where the VAT at stake runs into the millions.
About Keystone-
Projects with VAT in the millions
Experience of construction projects where the VAT liability alone ran to seven figures, and where a single misjudged rate would have been felt across the whole budget.
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High-profile and celebrity clients
Work for private clients in the public eye, where discretion matters as much as the answer. We never name a client or a project.
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Construction VAT and nothing else
No bookkeeping, no payroll, no year-end accounts. We work only on the VAT rules for buildings and construction.
Straight answers
The questions everyone asks first.
My builder says it's 20%. Is it worth checking?
Builders usually default to 20% because it is the safe answer for them. They carry the risk if the rate is wrong. It is worth a second look, because new homes, many conversions and renovations of long-empty homes qualify for less. Send us the quote and we will tell you whether there is anything to pursue.
Is it definitely going to save me money?
Not always. Some projects are correctly charged at 20%, and if yours is, we will say so. What you get either way is a properly reasoned answer, so you know the rate is right. If there is a saving, you will know exactly what it is worth.
Can't I just ask my accountant?
Many accountants do not specialise in construction VAT. It has its own legislation, its own HMRC notice and a long list of exceptions for individual materials. It is all we do. Accountants often bring in a specialist for exactly this kind of project.
What if HMRC disagrees?
Nobody can guarantee what HMRC will decide. What we give you is a written analysis supported by the law and HMRC's guidance. If a question is ever asked, the reasoning is already on your file. That is the strongest position to be in.
Will you deal with HMRC for me?
No. We do not act as an agent with HMRC and we do not file anything. We do the analysis and the paperwork. Anything that has to be submitted stays with you or your accountant.
How much does it cost?
A fixed fee, agreed before we start, that depends on the size and complexity of the project. If you begin with a qualification report and then go on to the full line-by-line analysis, the report fee is credited against it, so you never pay twice.
Next step
Send us the quote. We’ll tell you whether there’s anything to save.
Upload your builder’s quote or tender. We look at the project and the pricing and tell you whether a lower rate is worth pursuing, before you commit to anything.
- Fixed fee, agreed up front
- Every rate tied to the legislation
- We'll tell you if it's 20%