When property is being developed you find the builder/customer automatically goes straight to the merchants to pick up materials/products.
Now this tip involves some pre-planning but if you have a development coming up or a new property to spruce up before you move in and you know what is required then start looking for the materials using second hand sites, such as gumtree or free ads or Facebook. People give away left over building products at a third of the price and sometimes are happy to deliver.
The types of materials I’m talking about are things like insulation (and it doesn’t matter if they are different shapes and sizes it can all still be used), internal doors, external doors, used upvc windows, curtains, furniture, fire surrounds, floor boards, paint, tiles, roof slates, bricks, (I could do this all day).
Hopefully you’re getting the idea, so with a bit of planning you could save thousands of pounds by using second hand products. If your worried about using second hand products a lot of the time things like building materials are brand new it’s only the fact that the seller has over ordered on their particular project. On top of that you will be helping the environment by reducing the amount of waste chucked away in landfill.
Be sure to let the builder know what you are planning as we always come across products on jobs that are just being thrown away, i make an effort now to post things on gumtree for people to collect for free when I’m carrying out particular jobs as it helps me out by reducing my waste bill and I know good materials are not being wasted.
Also if your passing a place where things are in the skip speak to the builder or owner of the property where the work is being carried out and see if its OK for you to have it..Usually its no problem at all.
My father in law is the best person i know at doing this, hes always coming back with different things. I got roped into picking up 2 x sheets of timber that the local gym was disposing off after their refurbishment and he made the grand kids a tree house out of it, he also came across some amazing sliding wardrobe doors that where leaning up against a skip ready to be thrown out.
So you can find lots of gems if you just make yourself more aware.
How to save VAT (Value added Tax) for developers
Any tradesmen (builder, plumber, electrician, etc.) whose gross annual revenue exceeds £83,000 has to notify HMRC and become VAT (Value Added Tax) registered.
This means that VAT will be added to all labour that they provide, which at current rates means an extra 20%. Materials’ costs will nearly always include VAT, whether the tradesman was VAT registered or not as most suppliers will already be charging it to the tradesmen who are sourcing materials for you. Building companies that charge VAT are usually the companies that carry out the works such as extensions and refurbishment projects. So before accepting a builder’s quote always check if VAT is to be added as it should be clearly stated on the quote. However, sometimes this can be omitted, so it’s always worth double checking.
There are obviously savings to be had by using builders that are not VAT registered 20% straight away on standard building works. I do understand the instinct to save costs by going with the builder that is not VAT registered as I have been on both sides of the coin. As a sole trader, I was not registered, but as I began taking on bigger jobs and sub-contracting labour, I changed my trading status to a limited company and then eventually had to become VAT registered. You have to expect that in bigger refurbs/new builds, the builder will be VAT registered. As the threshold is only a turnover of £83000, with extensions, for example, costing around £30000- £40000, you can see why this bracket will soon be met when carrying out just several of these over a year.
I still continue to perform small jobs, and a lot of the time if the customer has used me before, they have continued using me regardless of VAT being added. I think a lot of people will pay builders who are in the VAT threshold if they are good reliable guys, and remember if you’re using a good builder that isn’t VAT registered, chances are they will soon become VAT registered as their popularity and reputation increases.
If you are thinking of developing or converting property, be sure to read VAT Notice 708 on the gov.uk website. This describes the different VAT rates that apply to different building work as it’s not all necessarily charged at 20%. In brief, if you are looking at converting a property or working on a listed building, you could pay as little as 5% VAT on materials and labour instead of the standard 20%.
If you are looking at building a new build, you could pay zero VAT. This could save you thousands on your next project, so be sure to educate yourselves.