In a judgement on the specific issue argued in the First Tier Tribunal (FTT) case of St George’s Augustinian Care, the FTT gave some further guidance on cases where zero-rating can apply to the construction of dwellings.
In this case, a separate building was constructed to provide communal leisure facilities for residents of a retirement village.
The FTT ruled that the construction of this building did not qualify for zero-rating as part of a dwelling, on the basis that just because a resident had the right to use these facilities; this did not mean that they formed part of a dwelling(s).
This decision contrasts the position where a gym is incorporated into a block of apartments for use by residents; which would qualify for zero-rating. It also clarifies the position as published recently by HMRC in Brief 13/16 which confirmed that in certain circumstances a single dwelling may consist of more than one building.