Self-Build in Northern Ireland

Things you need to know….

Finding the right Plot

There are a number of things you should consider when searching of your ideal place to build.

• Is there clear access to your site?  There are only a handful of mortgage lenders in Northern Ireland who will lend you for the purposes of a self-build.  Criteria may include that the lands have clear access from a main road and may not favour a shared access.  Before completing your purchase, you can make enquiries with lender without submitting an application.  The lender can look at the site map and deed to see if it firstly fits their lending criteria.

• Many lenders will require to purchase the site outright without borrowing before extending a mortgage against your site. 

• Are services such as water and electricity nearby?  The costs of bringing essential services on site can be expensive.  Do your homework, agreeing with the contractor that you will provide trenches for services could save you thousands.

• Can materials and heavy plant easily assess the site?  Sites that are hard to access can result in delays and additional costs if deliveries cannot directly access your site.

• Check if the lands adjoining the site likely to be developed in the future.  Building nearby could disrupt the view from your dream home.  You can make enquiries with the local planning office or ask your Solicitor to make enquiries on your behalf.

• Be aware of property values in the area, you want to ensure the cost of your build will not be more than the property value once completed.

• The rateable value of your property in your chosen area when the build is completed.  You will need to factor this cost into your budget.

• Always take out self-build insurance, when you are bringing various contractors onto site you may require to have liability insurance in place. 

Planning

If you are buying a site with outline planning permission it’s a good idea to make enquiries with the local planning office to confirm the planning consents have not expired.  Your Solicitor can do this for you also.

Usually once foundations have been laid the planning will not expire however, you should obtain a certificate of building from the planning office to confirm building can commence.  Your mortgage lender will require this also.

Employing a professional who has experience will planning matters and who can draw up and cost your plans to build will be essential.

Your site must have clear access and clear site lines must be in place before your build will be signed off and before you can move in.

Financing your Build

Mortgages for self-build projects in Northern Ireland are limited, at the time of writing the following lenders advertise self-build mortgages:

• Danske Bank
• Progressive Building Society
• AIB

When your mortgage is approved it is usual that the funds will be extended to you in four or five stages.  At each stage the lender will require a site inspection and the build stage to be signed off.  This protects the Bank’s security but also gives you the opportunity to review the build costs as you proceed.

Reclaiming VAT

You can reclaim the VAT element of eligible building supplies associated with your new build or conversion.

To do this you will to claim within 3 months of the building work being completed.

You be required to obtain form 431NB to claim a VAT refund on a new build, or form 431C to claim for a conversion from HM Revenue and Customs.

You must include the following documents as part of your application:

• all original invoices
• a full set of building plans
• either Full Planning Permission, or both the Outline Planning Permission and Approval of Reserved Matters
• the Building Regulation Completion Certificate or other evidence the work is complete - there’s a list of accepted documents in the form

You must send the original invoices, not copies. You can include copies of other documents.

If you’re claiming for a conversion, you must also prove the building had not been lived in for at least 10 years before the work started.

If an invoice is not in your name, you’ll need to explain why. If an invoice is in your business’s name, you’ll need proof that you’ve refunded the amount from your personal bank - for example, a bank statement.

VAT invoices must be valid and show the correct rate of VAT or they will not be accepted. For invoices not in sterling, convert the amounts into sterling.

Send your claim form to HM Revenue and Customs (HMRC).

National DIY Team
S1751
Newcastle
NE98 1ZZ

HMRC will write to you about when you can expect your VAT refund if your claim is successful. They will usually write to you within 6 weeks.

Help with VAT for building materials

Contact HMRC if you have further questions.

DIY and House Building VAT Enquiries Team
Telephone: 0300 322 7073
Monday to Friday, 8:30am to 4:30pm
Credit: HMRC

Building a new home and VAT: How to claim - GOV.UK (www.gov.uk) correct as at Feb 2022