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BBC 'Moneybox' On Self Build


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#1 Alphonsox

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Posted 31 May 2015 - 02:40 PM

There was a piece on self build on BBC Moneybox this week including an interview with the Housing Minister.

About 5:30 into the broadcast
http://www.bbc.co.uk...rammes/b05wn7sh

Nothing earth shattering - finding plots is difficult, self build mortgages are difficult to arrange and expensive, the government hopes to make things better etc. etc.

Edited by Alphonsox, 31 May 2015 - 02:52 PM.


#2 SteamyTea

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Posted 31 May 2015 - 04:39 PM

There is also this bit about affordable housing, seems to be very southern.
http://www.bbc.co.uk...rammes/b05vzysp

#3 CC45

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Posted 01 June 2015 - 05:21 PM

what about allowing quarterly VAT reclaim - the normal practice for businesses. Would help cashflow.

cc

#4 jsharris

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Posted 01 June 2015 - 06:03 PM

View PostCC45, on 01 June 2015 - 05:21 PM, said:

what about allowing quarterly VAT reclaim - the normal practice for businesses. Would help cashflow.

cc

That would be a masterstroke! We've been cash-strapped for the past year, slowing progress down to what I can afford each month from my pension, but we could easily finish within a couple of weeks if we could get the VAT back. Currently the VAT man owes us over £12k.

#5 oz07

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Posted 01 June 2015 - 06:34 PM

How much have you got left to spend on vat Jeremy? Surely there comes a point when it's better to realise that money and finish and forfeit the rest?

#6 ProDave

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Posted 01 June 2015 - 06:39 PM

This is an interesting dilemma.

I'm just appointing some guys to pour my concrete foundations, then build up the blockwork.

we discussed who is providing the materials and we agreed they would provide them as they can zero rate them along with their work. If I supply them I won't get the VAT back for a couple of years. I just have to watch they don't charge too much of a mark up.

#7 ProDave

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Posted 01 June 2015 - 06:41 PM

View Postoz07, on 01 June 2015 - 06:34 PM, said:

How much have you got left to spend on vat Jeremy? Surely there comes a point when it's better to realise that money and finish and forfeit the rest?
I faced that dilemma on my last build.

We had nearly ran out of money and still had the garage to build. So I bought some of the stuff like the garage doors, then did my VAT claim and used that to fund the finishing of the garage.

It would be interesting to see how the economics would have stacked up by short term borrowing the funds to finish the garage so I could have re claimed the VAT on the whole lot.

#8 sarahsouthwest

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Posted 01 June 2015 - 06:47 PM

+1 to allowing VAT to be claimed back quarterly. I read somewhere that loads of self-builders end up claiming early just to ease the cash-flow.

#9 warby

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Posted 01 June 2015 - 08:00 PM

View PostProDave, on 01 June 2015 - 06:39 PM, said:

This is an interesting dilemma.

I'm just appointing some guys to pour my concrete foundations, then build up the blockwork.

we discussed who is providing the materials and we agreed they would provide them as they can zero rate them along with their work. If I supply them I won't get the VAT back for a couple of years. I just have to watch they don't charge too much of a mark up.
This will only work if the contractor is registered for VAT, i.e. they claim back the VAT and then charge you VAT at zero percent on both materials and labour.
If a contractor is not registered for VAT then the self builder should always pay directly for materials from the supplier not the contractor because they can eventually claim back the VAT.
The answer to overcome the unfair anomaly that a VAT registered builder can claim VAT back during a build whereas a self builder can only claim back at the end of the build is to use a VAT registered builder for the build. Think laterally: what is stopping your friend/relative setting up as a VAT registered builder, you remain his sole customer and he makes a small loss at the end and then the company can be closed. A limited company is not needed. Ridiculous but if you want a solution!

#10 jsharris

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Posted 01 June 2015 - 08:06 PM

View Postoz07, on 01 June 2015 - 06:34 PM, said:

How much have you got left to spend on vat Jeremy? Surely there comes a point when it's better to realise that money and finish and forfeit the rest?

I still have to find the cash for the major landscaping materials, ideally before I do the VAT reclaim. I may have to just bite the bullet and forego getting the VAT back on these, and just do the remaining work needed to get a completion certficate. I just begrudge having to pay 20% on stuff that's on our agreed landscaping plan that I don't have to.

#11 warby

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Posted 01 June 2015 - 08:34 PM

View Postjsharris, on 01 June 2015 - 08:06 PM, said:

I still have to find the cash for the major landscaping materials, ideally before I do the VAT reclaim. I may have to just bite the bullet and forego getting the VAT back on these, and just do the remaining work needed to get a completion certficate. I just begrudge having to pay 20% on stuff that's on our agreed landscaping plan that I don't have to.
When a VAT registered company submits a VAT return they can either do it on cash basis or an accrual basis. On an accrual basis if you have received a VAT invoice with a tax point before the tax return end date you can claim back the VAT even if you have not paid the invoice. I have never checked with the revenue but you may be able to use this same rule to your advantage, i.e. very useful if you can get a credit period from your suppliers. Hope this helps

Edited by warby, 01 June 2015 - 08:35 PM.


#12 notnickclegg

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Posted 01 June 2015 - 08:40 PM

View Postjsharris, on 01 June 2015 - 08:06 PM, said:

I still have to find the cash for the major landscaping materials, ideally before I do the VAT reclaim. I may have to just bite the bullet and forego getting the VAT back on these, and just do the remaining work needed to get a completion certficate. I just begrudge having to pay 20% on stuff that's on our agreed landscaping plan that I don't have to.

Any reason not to take out a small personal loan, or even use a credit card? The interest would be quite small compared with the loss of VAT refund.

Jack

#13 jsharris

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Posted 02 June 2015 - 06:50 AM

Thanks to having my car written off last summer, I already have a loan (that I didn't really want to take out, but had little choice because of the bad timing of the accident). Being retired limits my options a lot when it comes to getting any sort of finance, too, unfortunately. It seems lenders are very reluctant to lend to people who have retired, even if they have a reasonable pension and younger than normal retirement age. In some ways I'd have been better getting a part-time job simply to avoid having to write "retired" in the occupation box on any form, as it does seem to create problems with everything from borrowing to insurance.

I could use a credit card, but I've been trying not to borrow any more, just a personal thing, really, as I'm time rich and currently cash poor.

#14 SteamyTea

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Posted 02 June 2015 - 08:00 AM

Jeremy
Write a book about your self build adventure (Joiner will edit it for you).
Then you can put down 'writer' as occupation. ^_^

#15 jsharris

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Posted 02 June 2015 - 08:07 AM

View PostSteamyTea, on 02 June 2015 - 08:00 AM, said:

Jeremy
Write a book about your self build adventure (Joiner will edit it for you).
Then you can put down 'writer' as occupation. ^_^

Excellent idea, I may do something like this. One of my new neighbours always describes himself as an author, and at a guess he's a lot older than me. I believe he's only ever written a couple of books, but maybe he's also discovered that describing yourself as retired causes some issues.

#16 bitpipe

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Posted 02 June 2015 - 08:24 AM

My I suggest that, to differentiate if from the other slew of self build books, you intersperse it with your many entertaining anecdotes? The machine gun factory visit deserves a chapter to itself.

#17 SteamyTea

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Posted 02 June 2015 - 08:38 AM

And the Red Arrow picture when writing about planners

#18 Alphonsox

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Posted 02 June 2015 - 08:45 AM

If you have had anything published in the past (technical paper, training manual, ebuild blog) then you are by definition an author.

#19 notnickclegg

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Posted 02 June 2015 - 08:53 AM

View Postjsharris, on 02 June 2015 - 06:50 AM, said:

I could use a credit card, but I've been trying not to borrow any more, just a personal thing...

Completely understandable - that's a healthy attitude to have.

Jack

#20 jsharris

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Posted 02 June 2015 - 08:57 AM

View PostAlphonsox, on 02 June 2015 - 08:45 AM, said:

If you have had anything published in the past (technical paper, training manual, ebuild blog) then you are by definition an author.

Good point. Apart from scientific papers published in journals, I've written quite a few magazine articles over the years, some in the last three or four years, so I could probably use the term. I'd never really thought about it until now, but it could be a way around the problem, and although most of the scientific papers are still restricted, the articles in magazines can easily be used as proof if anyone asks.