Readers’ forum: A knock on the door

I act on behalf of a builder who has been issued with an assessment for underpaid output tax by HMRC. This was for a job he carried out three years ago for a property landlord. The landlord is not registered for VAT. The building consisted of a ground floor shop and first floor office and my client charged 5% VAT on work being carried out on the first floor which converted the office into a flat.

VAT on work relating to the shop was charged 20% VAT. However the problem is that my client has only charged 20% VAT on one quarter of the work carried out to areas not specific to each floor; for example the roofing works concrete work in the yard landscaping work at the front and the like.

The client charged 5% VAT...