French contractors

A partnership client trades as general builders in the UK using subcontract labour. There are no employees. The partners have the possibility of undertaking some work in France. This will involve them spending some time over there while they are carrying out the contract.

To maximise the profit potential of the business the partners are considering buying a run-down property for the subcontract labourers to stay in while working on the contract. In their ‘spare time’ the labourers will be paid to renovate the property for the business to sell on at a profit when the work is complete.

The partners will buy most of the materials in the UK and take them over to France although some small items may be purchased in that country.

What tax and VAT considerations would they need to consider in respect of this work and would there be any significant differences...