Our architect has advised us that the disabled-access
ramp and accessible lavatory in our building programme are
zero-rated for VAT. Since we plan to reclaim VAT under the Listed
Places of Worship (LPW) Grant Scheme, this information seems
irrelevant - or should we be taking action?
YOU should be taking action. There are two separate systems:
paying VAT on works and then reclaiming; and having work zero-rated
and not reclaiming.
The stinger is that if your builder charges you VAT on
zero-rated works, you cannot reclaim this VAT through the Listed
Places of Worship Grant Scheme. When your building-works contract
is established, you should get the builder to agree that VAT will
not be charged on works specifically for disability access.
A quick summary of the Listed Places of Worship guidelines is in
order here, as I still get asked plenty of questions about the
scheme, and find that there are church treasurers who have no
experience in making claims.
The LPW Scheme makes weekly payments, and eligible claims with
all the correct documentation are paid very quickly - even with
queries, this is normally within 30 days.
Eligible works include repairs and alterations, including
plumbing and electrical works, kitchens and lavatories, floors (not
movable floor-coverings) and handrails, decoration, pews, asbestos
removal, security and crime prevention, turret clocks, bells, pipe
organs, and most of the professional fees associated with these
eligible works, including the planning and design. It does not
include things such as legal fees, fund-raising costs, faculty
costs, and accountancy.
Claims have to be made withina year of the expenditure. Claims
are normally against VAT on expenditure of more than £1000,but each
year one claim from a church will be accepted at £500 or more.
Since all kinds of repair works to the church are eligible, it
is worth sifting through the records of payments made and
identifying invoices that together reach the target sum; £500 is
not a high threshold, even for minor repairs. And keep up to date:
consider VAT claims regularly, say every six months, to ensure that
no claims are missed.
When more significant building works are under way, the process
may be set up to make parallel payments to the professional team
and the builder. Ensure first that the design-stage invoices are
not left more than a year; but it can be much clearer what they
relate to if they are submitted with the first contractor's
On building projects, it is normal for there to be a monthly
site meeting between the builder, the professional design-team, and
the client. It is also the time for the builder to value the work
achieved since the last meeting. The architect produces a
certificate agreeing the value of the work done, and the contractor
issues an invoice. (Do not pay the contractor until the architect's
certificate is in your hands.)
Pay the contractor, and check all fee invoices to date, and you
can immediately make a claim to the Listed Places of Worship Grant
Scheme. This reduces the negative cash-flow impact of having to pay
out and then reclaim the VAT. Your funds will only ever be out of
more than one month's VAT, even though the total VAT for the
project is quite significant.
Ensure that you send the correct paperwork to the Scheme,
together with the claim form, which is available at
Send your questions and comments to