VAT News

Housing Associations - Updated Framework for Partial Exemption Special methods


HMRC have recently published a new version of the sector framework for partial exemption special methods.  This guidance updates and expands the April 2010 version.  In addition to a general rewrite to improve navigation and readability, the main areas of new and updated content are:

  • The impact of non-business activities and agreeing business/non-business methods
  • Tenant recharges
  • Service charges
  • Cost sharing groups
  • Feed in Tariffs
  • Sample partial exemption calculations
  • Abortive costs
  • PFI
  • New build projects
  • Zero rating of construction services
  • VAT shelter works
  • Seeking approval for a partial exemption method

Importantly, the Framework confirms that Housing Associations are able to backdate a partial exemption special method up to 4 years where agreed within “a reasonable time” of the guidance being updated.  Housing Associations who have not reviewed this issue in recent years might want to do so to see if they can benefit from a change of method.  The guidance is available on the HMRC website at:

For further details, contact Julie Rawlinson-Smith on 07805 134091

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