I have a query regarding a developer and a builder of a new build joint commercial and residential property. The property has recently been completed. The developer is not VAT registered and is subcontracting the builder who is. My questions are: (1) Is the builder able to supply services to the developer at the zero rate of VAT for the residential part?; (2) Can the developer backdate VAT registration to claim any input VAT and sell the building at zero rate (on the residential part)?; and (3) Is there a deadline opting to tax?

(1) Look at Public Notice 708 section 3.2.2 second bullet point, where you can see that if the residential part can be disposed of, or used, separately to the business premises then you can zero rate its construction. (2) You cannot backdate the VAT registration, but you can reclaim input VAT from before registration, six months for services, and four years for materials that are still present. See section 11 of VAT Notice 700. (3) The deadline for opting to VAT is 30 days after the decision is made to opt to VAT. See section 4.2.1 of Public Notice 742A.