HMRC Updates VAT Guidance on Overage Payments in Property Transactions

• HMRC issued guidance on VAT treatment of overage payments.
• Overage payments are additional payments made after property purchase.
• VAT liability of overage is separate from the initial sale.
• VAT liability is determined at the time of overage payment supply.
• Special rules apply to new commercial buildings under three years old.

Source: taxscape.deloitte.com

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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