Page 11 - Lettings Revolution
P. 11
Diligence
The journey from conception to the full implementation of the
Primary Tenancy™ model into the pilot lettings agency took
a total of 28 months. That’s a lot of time and ground breaking
work you won’t have to do when you become a member of
The Lettings Revolution. All you need do is follow in our
footsteps
HMRC
Once the concept was conceived, the first step was to use a
Chartered Accountant to approach HMRC in order to fully
disclose the proposed new business model and obtain
clearance for it. This process involved two rounds of
disclosure, during which HMRC were very clear on the VAT
position. However, to make absolutely certain, after the pilot
had been underway for some time HMRC were approached
again with a request for a VAT inspection with the specific
objective of checking that the process was fine in practice. This
inspection took place and the pilot business was given a clean
bill of health. The whole process took 28 months to complete.
Here is a direct quote from HMRC in relation to the Primary
Tenancy™:
‘The supply of a lettings service is subject to the standard rate of
VAT. However in accordance with the VAT act 1994 Schedule 9
Group 1 Item 1, the letting of a residential property is exempt from
VAT. Guidance on this issue can be found in Public Notice 742.
Therefore, where you make such a supply of residential property, as
landlord, you will be making an exempt supply. Conversely, where
you are receiving such a supply of a residential property, as tenant,
you will be receiving an exempt supply’.
The journey from conception to the full implementation of the
Primary Tenancy™ model into the pilot lettings agency took
a total of 28 months. That’s a lot of time and ground breaking
work you won’t have to do when you become a member of
The Lettings Revolution. All you need do is follow in our
footsteps
HMRC
Once the concept was conceived, the first step was to use a
Chartered Accountant to approach HMRC in order to fully
disclose the proposed new business model and obtain
clearance for it. This process involved two rounds of
disclosure, during which HMRC were very clear on the VAT
position. However, to make absolutely certain, after the pilot
had been underway for some time HMRC were approached
again with a request for a VAT inspection with the specific
objective of checking that the process was fine in practice. This
inspection took place and the pilot business was given a clean
bill of health. The whole process took 28 months to complete.
Here is a direct quote from HMRC in relation to the Primary
Tenancy™:
‘The supply of a lettings service is subject to the standard rate of
VAT. However in accordance with the VAT act 1994 Schedule 9
Group 1 Item 1, the letting of a residential property is exempt from
VAT. Guidance on this issue can be found in Public Notice 742.
Therefore, where you make such a supply of residential property, as
landlord, you will be making an exempt supply. Conversely, where
you are receiving such a supply of a residential property, as tenant,
you will be receiving an exempt supply’.
