VAT on Property Sales:
If it is the intention of the purchaser to convert a building into a dwelling or dwellings they must complete, prior to exchange of contracts, HMRC form 1614d, this should allow the vendor not to charge VAT on the sale.
HMRC suggests all parties completing this certificate read: Notice 742A Opting to tax land and buildings, which also sets out other examples of when VAT can be disapplied, such as sales to registered charities and housing associations.
It is strongly recommended that all purchasers should seek written advice from their own professional advisors as to the treatment of VAT on any property transaction that they are considering.
Further infomation can be found at www.hmrc.gov.uk