New VAT Rules for Mixed-Use Buildings: Changes Effective July 1, 2025

• The VAT rules for work on mixed-use buildings have changed as of July 1, 2025.
• Before July 1, 2025, if more than 50 percent of a building was used for private residence, the entire building could be charged a 9 percent VAT rate for certain work.
• After July 1, 2025, the 9 percent VAT rate applies only to the residential part of the building.
• The work includes insulating, painting, plastering, and wallpapering homes older than two years, and cleaning homes regardless of age.
• Mixed-use buildings have both residential and other functions, such as commercial.
• Examples include live-work buildings, residential buildings with shared spaces, and mixed-use facilities like care homes.
• Until July 1, 2025, if more than 50 percent of a mixed-use building was for private residence, the entire building could be treated as residential for VAT purposes.
• From July 1, 2025, only the residential part can use the 9 percent VAT rate.
• Work on non-residential parts is subject to a 21 percent VAT rate.
• Shared spaces used for both residential and other purposes must have VAT divided based on usage, with parts charged at 9 percent and others at 21 percent.

Source: taxence.nl

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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