VAT on self builds
At a glance, VAT rules for new builds
Labour: zero rated. If you use a VAT-registered contractor, they must charge you zero VAT on labour.
- Most building materials: VAT can be reclaimed after completion.
- Services such as architect fees, scaffolding and plant hire: VAT must be paid and cannot be reclaimed.
- Garages attached to the planning permission for use with the new dwelling can be claimed for.
- Hard landscaping: reclaimable only if specifically approved by your local planning authority as part of a formal landscaping plan.
- Gas and electrical appliances wired in and designed for heating, cooling or air/water purification (e.g. air conditioning units) can be claimed, check the form.
- Only one VAT claim is permitted per dwelling.
- That claim must be submitted within six months of completion.
- HMRC will require a valid planning permission and a completion certificate.
The sale of new dwellings is zero rated for VAT in the UK, which means the labour and qualifying materials used to build your home should also be zero rated. Self build projects are eligible for VAT relief provided they create a new dwelling that you will occupy as your main home, are lawful, and are evidenced by a completion certificate.
If you use a VAT-registered builder, they must zero rate eligible labour and qualifying materials on your invoices. You should not be charged VAT on labour under any circumstances, check your invoices carefully.
For building materials you purchase directly, VAT is still charged at the point of sale, but you can reclaim it after completion using HMRC’s DIY Housebuilder scheme. The relevant claim forms, VAT431NB for new builds and VAT431C for conversions, are available on Gov.uk and include detailed notes on what qualifies. Those who already hold a VAT registration can reclaim via their normal VAT return using the self-supply rules instead. HMRC’s guidance on VAT for new builds and VAT for builders is also on Gov.uk.
Timing is critical, you have just six months from the date of your formal completion certificate to submit your VAT claim. Miss that deadline and you cannot claim at all. Around a third of self builders fail to submit in time and lose out on a refund that can easily reach £10,000 or more.
VAT on conversionsFree downloadWant the complete picture?Download the official 2026 NaCSBA Consumer Guide — covering everything from finding a plot to getting on site. Free to registered users.Download free guide →Register free · No card required Conversions work slightly differently.…
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