Barn conversion was carried out in two stages

The taxpayer received planning permission in 2010 to convert a barn into a dwelling. The building work was carried out and a completion certificate issued on 24 March 2021. He submitted a DIY VAT refund claim to HMRC within three months of the completion date – as specified in VATA 1994 s 35 – which HMRC repaid in December 2021. The claim was in accordance with the legislation because a non-residential building had been converted into a dwelling.

In January 2022 the taxpayer obtained planning permission to add a second bedroom to the dwelling which was described as an ‘extension to existing barn conversion’. A further completion certificate was issued on 10 October 2022 and he submitted a further VAT claim to HMRC. The department rejected this claim on the basis that it related to an extension of an existing dwelling.

The taxpayer appealed. He...