VAT on your quote
Your builder sets the VAT on their quote. Most renovation work is charged at 20%, but some work qualifies for 5% or 0%, and a builder who isn't VAT registered won't charge VAT at all.
Builder quotes on Beams are priced before VAT, with VAT added on top. Your quote shows the price, the VAT and the total you'll pay. Change orders work the same way.
Who sets the rate
Your builder does. They know the work, and they answer to HMRC for the rate they charge. Beams doesn't set it.
The rates you might see
- 20% (standard). Most renovation work on a home people live in: kitchens, bathrooms, extensions, loft conversions and refurbishments.
- 5% (reduced). Renovating a home that's been empty for at least two years. Changing the number of homes in a building, such as turning a house into flats. Converting a barn, shop or other non-residential building into a home.
- 0% (zero). Qualifying energy-saving materials, such as insulation, heat pumps, solar panels and home batteries. Building work needed because of a disability, such as a ramp or an adapted bathroom. Building a brand new home.
- No VAT. If your builder isn't VAT registered, they can't charge VAT. Smaller businesses with turnover under £90,000 a year don't have to register.
The 0% rate on energy-saving materials is temporary. It runs until 31 March 2027, then goes up to 5%.
Why your quote might show more than one rate
Some projects mix work at different rates. Say you're refitting a kitchen and putting in a heat pump. Your builder can charge 20% on the kitchen and 0% on the heat pump in the same quote. They'll say what each lower-rate part covers, so you can see where your total comes from.
If you think a lower rate applies
Tell your builder before they quote. Some lower rates need something from you:
- An empty home. Proof it's been empty for two years, such as council tax records or a letter from the council.
- Work for a disabled person. A signed eligibility declaration. Your builder can give you the form.
It's your builder's call whether the work qualifies. If it doesn't, they'll charge 20%.
Questions about the VAT on your quote
Ask your builder first, since they set it. If you're still unsure, message your Beams planner. Beams can't give tax advice, so for anything about your own tax position, speak to an accountant.