Financial Assistance with Building Work

Reduced or Zero-Rated VAT

Usually, VAT makes up a hefty proportion of the cost of any building work. The standard rate of VAT is applied to most construction work, but there are some instances when a reduced or zero rate applies to material and labour costs, provided the work is carried out by a builder. If you are doing the work, you will have to pay the standard rate on all materials.

• Alterations to make a property suitable for a disabled person are zero-rated.
• New building work is zero-rated for VAT. Renovations, improvements, and even new extensions don't count as new building work, but if you are demolishing and rebuilding on old foundations, you may have a case.
• Some alterations to listed buildings are zero-rated.

At the time of writing, a reduced rate of 5% applies to the installation of energy-saving materials. This covers:

• insulation for water tanks, pipes, and other plumbing fittings
• insulation for walls, floors, ceilings, roofs, and lofts
• draught proofing for windows and doors
• hot-water system controls
• central-heating controls, including thermostatic radiator valves
• solar panels.

The reduced rate does not cover electric dual immersion water heaters or substantial improvements, such as completely replacing draughty windows.

Grants

Grants are few and far between.

• If you live in a listed building or Conservation Area, you may be eligible for a percentage of the cost of repairs directly associated with the historic fabric of the building. But, as with all planning issues, the concern is with public rather than individual benefit. You are more likely to receive help with restoring a significant building that you don't use, than you are for your own home, which it is clearly in your interests to maintain.
• For home maintenance and improvement, they tend to be awarded only to those most in need: the elderly, the disabled, and those receiving state benefits.