Yes — but indirectly. Your contractor charges 5% VAT on their services (labour and any materials they supply as part of the contract). You reclaim that 5% via VAT431C after completion. If your contractor has charged 20% instead of 5%, you cannot simply reclaim the higher amount — you need a corrected invoice before you can make a valid claim.
The reduced rate on contractor services is worth real money: on a £200,000 conversion contract, 5% VAT is £10,000 and 20% VAT is £40,000. If your contractor charges 20% and you have already paid it, recovering that overpayment requires the contractor's co-operation — which gets harder as time passes.
A contractor who provides only labour (no materials) on a qualifying conversion should charge 5% VAT on their invoice. The 5% is reclaimable via VAT431C.
Where a contractor supplies materials and labour together (supply and fix), the whole supply is at 5% — including the materials element of the contract price.
If a contractor has charged 20% on services that should be 5%, the excess 15% is an overcharge. HMRC will not allow you to reclaim it via VAT431C — you must obtain a corrected invoice from the contractor.
Materials you purchase directly from builders' merchants or suppliers are correctly charged at 20% standard rate. You reclaim that 20% via VAT431C — the rate is correct, not an error.
VATBuild is not affiliated with HMRC. References to HMRC publications are for informational purposes. Always consult a qualified tax adviser before submitting a reclaim.
VATBuild reads contractor service invoices and checks the VAT rate applied against what HMRC Notice 708 says should apply to your project type. For conversions, it expects 5% on services and flags any invoice showing 20% as a potential overcharge requiring a supplier correction.