HMRC Clarifies VAT Relief Rules for Electrical Blinds in Building Projects
15/06/2023

HMRC has provided clarification on the rules regarding VAT relief for the installation of electrical blinds in building projects. According to HMRC VAT Notice 708, VAT relief does not apply to the installation of electrical blinds in new builds and house renovations, as they are not considered commonplace.

The notice confirms that regular roller blinds are deemed standard products incorporated into construction projects, making them eligible for VAT relief if all conditions are met. This clarification follows a First Tier Tribunal case involving Wickford Development Co Ltd, where HMRC agreed in May 2021 that VAT could be reclaimed on manual blinds.

However, as soon as an electric mechanism is used to operate the blind, it no longer qualifies for VAT relief. Sections 13.8.1 and 13.9 of Notice 708 have been updated to emphasize that electrical blinds are not typically incorporated in dwellings and therefore do not qualify for VAT relief as building materials. Developers are unable to recover VAT incurred on such goods as input tax due to the "builders' block."

It is essential for businesses involved in building projects to refer to HMRC guidance in VAT Notice 708 to understand the specific criteria for VAT relief on various products, including electrical blinds, to ensure compliance with the updated rules.