Standard-rated sale of freehold/leasehold holiday accommodation (Grp. 1, item 1(e))

The grant of any interest in, right over or licence to occupy ‘holiday accommodation’ is standard-rated because it is excluded from exemption (VATA 1994, Sch. 9, Grp. 1, item 1(e); HMRC VAT – Land and Property Manual at VATLP 12200).

The exclusion from exemption concerns:

aa freehold sale of a new building (i.e. one that is under three years old) if a covenant or planning permission stops the buyer from occupying the property throughout the year (Note (11)(a)); and

bthe grant of a tenancy, lease or licence under which the tenant can erect and occupy holiday accommodation (Note (11)(b))

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