VATupdate

Floods – VAT measures for reconstruction

Unofficial translation

In recent days, our country has had to contend with terrible weather conditions that have caused enormous – sometimes irreparable – damage to the homes of our fellow citizens in certain regions of the country. For many of our fellow citizens, the extent of the damage means that they will have to carry out major renovation works, for some of them even the complete rebuilding of their homes.

The application of a reduced VAT rate should enable the affected fellow citizens to carry out these repairs at a lower cost.

With regard to renovation works, the application of the reduced VAT rate of 6% could already be possible in certain situations on the basis of the current regulations for private homes older than 10 years.

A reduced VAT rate of 6% is also possible under certain conditions in the event of the demolition of a building followed by the reconstruction of the home by the client. The conditions for the application of this measure vary according to the locality concerned. One of the conditions is that the building concerned must in principle be completely demolished by or for the person who is rebuilding the house or has it rebuilt. In some cases this condition will not be met.

Given the exceptional nature of the severe weather that has ravaged the country, the Minister of Finance has requested his administration to provide for a tolerance allowing the application of the reduced VAT rate of 6% for reconstruction works in cases where the dwelling is not complete demolished by the developer himself, but suffered serious and irreparable damage as a result of the flooding, affecting the essential structural elements of the old building. Within the framework of this tolerance, however, all other conditions must also be complied with (e.g. for a minimum of 5 years only and mainly own home, maximum habitable surface of 200 m², having his domicile without delay and formalities to be complied with).

Source financien.belgium

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