If you notify HMRC of a decision to opt to tax land and buildings, you are typically required to notify HMRC within 30 days. The 30-day deadline was temporarily extended to 90 days to help businesses and agents during the pandemic, but that temporary extension has now ended for decisions made from 1 August 2021 onwards.

Supplies of land and buildings, such as leasing or renting out a property, are normally exempt from VAT. This means that no VAT is payable, but the person making the supply cannot usually recover any of the VAT incurred on property expenses.

However, it is possible to waive the exemption or ‘opt to tax’ the land. For VAT, the term ‘land’ includes any buildings or structures permanently affixed to it.

Once you have opted to tax, all the supplies you make of your interest in the land or buildings will generally be standard-rated. This will normally enable you to recover any VAT you incur in making those supplies.