Dramatic Reduction of VAT on Building Costs
As from 15 September 1999, the Added Value Tax (VAT) has been reduced by 15% from 20.6% to 5.5% for most work carried out by a builder on virtually every type of residence in France. This includes permanent and secondary residences, provided that the owner can certify to the builder that the property is at least two years old.
This reduction is also applied to building materials and fittings, supplied by the builder which figure on his invoice, and covers improvements such as thermal insulation, the conversion of an attic to additional living accommodation, and even for the minor work of painting, decorating or laying carpet.
However this reduction of VAT does not apply to new building. The construction of a garage or the building of a veranda, for example, is still subject to VAT at 20.6%
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