Mixed Use Developments have both commercial and residential interests within one scheme. This poses challenges in bringing together two separate forms of best practice as well as satisfying differing VAT treatments.
In recent years mixed use developments have become more common in the industry with many urban properties being repurposed into schemes consisting of both commercial and residential elements.
The differing treatments of VAT between these two distinct aspects of a mixed use property create problems with the apportionment of expenditure. Furthermore there is an overall conflict between the correct VAT treatment and the best accounting practice for reporting to landlord clients.
At Websters we use a purpose built template to simplify and overcome the inherent complications of mixed use properties in respect of both apportionment and VAT treatment. This template is designed to be compliant for both residential and commercial purposes and to generate intuitive, user friendly accounts.
Furthermore, and as added value to our clients, we are seeking to agree a simplified VAT treatment of mixed use developments with HMRC to allow an approved and simplified approach. This is designed to remove the conflicts arising from a standard application of the VAT legislation.