Can I Reclaim VAT on a Home Renovation?

No — there is no general scheme allowing homeowners to reclaim VAT on domestic renovation or extension works. Unlike new builds (VAT431NB) and qualifying conversions (VAT431C), ordinary renovation of an existing home does not qualify for a DIY housebuilder VAT reclaim. However, specific VAT reliefs may apply to particular elements of your project: energy saving materials (currently 0% VAT), empty property renovation at 5%, disability adaptations at 0%, and dwelling-number change at 5%. The correct strategy for renovation is to secure these reliefs at the point of contracting — not to plan for a refund after completion.

£0

Why this matters

£0 reclaimable under VAT431 for an ordinary renovation. But the wrong assumption — that you can reclaim it all later — leads homeowners to accept incorrectly rated invoices throughout the project, pay the wrong VAT rate at source, and miss the specific reliefs that are available. Getting this right at the start is the only way to minimise your VAT cost.

The key distinctions

No general reclaim — existing residential dwelling

Renovating, extending, or refurbishing an existing home is standard-rated at 20%. The VAT431 DIY scheme covers new builds and qualifying conversions only — not renovation of an existing home.

Specific relief — energy saving materials (ESM)

Qualifying energy saving materials (insulation, heat pumps, solar panels, etc.) supplied and installed by a VAT-registered contractor are currently 0% VAT until 31 March 2027. This is a rate applied at source — not a reclaim.

Specific relief — qualifying empty property

If your property has been empty for two or more years, qualifying renovation work by a contractor may be charged at 5% reduced rate under HMRC Notice 708 Section 8. Evidence of the empty period is required.

Specific relief — disability adaptations

Specified building works to adapt a dwelling for a disabled person's use can be zero-rated under VATA 1994 Schedule 8 Group 12. The works must meet HMRC's qualifying conditions.

Practical checklist

Confirm whether any part of your project qualifies for ESM 0% rate (insulation, heat pumps, solar, etc.)
Check whether the property has been empty for 2+ years — if so, 5% may apply to qualifying works
Identify any disability adaptation elements — these may qualify for 0% under a separate HMRC scheme
Do not rely on reclaiming standard-rate VAT after completion — there is no scheme for ordinary renovation
Review your contractor's quotation before signing to confirm the correct VAT rate is applied to each element
Ask your contractor which lines of their quote they consider ESM or reduced-rate and why
Keep evidence of any qualifying conditions (property empty period, disability, ESM specification)

HMRC notice references

HMRC Notice 708 Section 8—Reduced-rate supplies — qualifying renovation

HMRC Notice 708/6—Energy saving materials — qualifying works and rates

VATA 1994 Schedule 8 Group 12—Disability adaptations — zero-rating conditions

VATBuild is not affiliated with HMRC. References to HMRC publications are for informational purposes. Always consult a qualified tax adviser before making decisions about VAT on your project.

How VATBuild helps

What VATBuild checks for this situation

VATBuild helps you identify which elements of your renovation project attract specific VAT reliefs and at what rate. It checks each invoice against the applicable HMRC rules — energy saving materials, empty property, disability adaptations — and flags any line item where the contractor has applied the wrong rate or where a relief opportunity may have been missed.

Builder charged 20% on renovation work — is that right?Energy saving materials VAT rate Empty property 5% VAT Renovation VAT rates explained