HMRC accept that a veranda sold with a residential caravan can be zero or reduced rated for VAT. Their new position is outlined in Brief 12/15, published 30th July. This follows the Upper Tax Tribunal ruling in Colaingrove Ltd  UKUT 002 (TCC) that there was a single supply. HMRC now concede that the VAT liability of a verandah is the same as that of the caravan and will update their Notice 701/20, on caravans and houseboats, in due course. Claims for refunds of VAT wrongly paid in the past, some based on HMRC’s previous wrongful guidance, need to be made before becoming timed-out.
Tax Barrister, Accountant