Revenue & Customs Brief 5 (2021): 'VAT liability of installation of blinds – First Tier Tribunal decision' explains HMRC's revised policy on the VAT treatment of installation of blinds.
- The construction of a Dwelling is zero-rated for VAT purposes. This applies to construction services and building materials provided by the persons supplying the construction services.
- Building materials are defined as: 'goods of a description ordinarily incorporated by builders in a building of that description (or its site)'.
- This includes bricks, timber, kitchen units, sinks, washbasins, baths and toilets.
- The definition of building materials is also significant for DIY housebuilders, who are able to reclaim VAT charged on building materials (typically charged because there is no associated qualifying service).
- HMRC's stated policy was that roller blinds and other ‘window furniture’ were not building materials.
- Roller blinds could not be zero-rated nor could VAT be recovered under the DIY housebuilders' scheme.
- HMRC's position was challenged in Wickford Development Co Ltd (Wickford) v HMRC  TC07864, where the First Tier Tribunal (FTT) found that manual window blinds are building materials that did not fall into any of the exceptions. As such, they could qualify for zero-rating.
- From 5 October 2020, HMRC have accepted the FTT decision that manual window blinds and shutters are building materials for VAT purposes.
- This does not extend to motorised blinds, which are included in the exceptions of the blocking order as electrical appliances.
- Where VAT has previously been disallowed based on HMRC's former policy, a Correction can be made on the VAT return, subject to the four-year cap and Unjust enrichment rules.
Useful guides on this topic
Land & Property: Dwellings
What is a dwelling for VAT purposes? What is the VAT treatment for construction, conversion, sale, and letting of a dwelling?
Land & Property VAT (Subscriber guide)
An outline of the VAT treatment of some of the more common supplies of land and property.
Land & Property: DIY Housebuilders scheme
It is possible to recover VAT on constructing a new residential dwelling, or dwellings, even where there is no planned sale of the property. This recovery can arise under the special refund scheme for DIY housebuilders.
New build blinds: building materials for VAT
In Wickford Development Co Ltd (Wickford) v HMRC  TC07864, the First Tier Tribunal (FTT) found that VAT charged on roller blinds incorporated in the buildings was eligible for recovery as ‘building materials’.