VCONST03420 - Zero-rating major interest grants in buildings: holiday homes: applying Note 13 to residence restrictions

Before applying Note 13 you will need to identify any residence restrictions that may exist. »Ê¹ÚÌåÓýappse will normally be identifiable from the conditions of sale or planning permission.

»Ê¹ÚÌåÓýapp Tribunal decision in Loch Tay Highland Lodges Limited (VTD 18785) has confirmed that for a grant to be zero-rated both of the following tests must be met. If either test is not met then the grant is not zero-rated:

  • the recipient of the grant (the grantee) must be able to use the building, or part of the building, as a residence for the whole of the year (VCONST03430)
  • the recipient of the grant (the grantee) must be able to use the building or part of the building as their principal private residence (VCONST03440).