The National Housing Federation has successfully persuaded HM Revenue and Customs (HMRC) to drop its proposal to seek to include VAT on professional services in design and build contracts.
The Federation estimates that the plans to introduce VAT on design and build deals with contractors would have cost housing associations £108m over the course of the current development programme. As associations had already submitted their development funding bids to the Homes and Communities Agency without factoring in the proposed VAT costs, the withdrawal of the proposal will come as a welcome reprieve.
HMRC will notify businesses that the existing VAT regulations remain in place: design and build contracts will not have VAT added while design services purchased separately from the build will continue to have 20% VAT added.
A report into how local authority cuts are affecting charities reveals a £7 million drop in support for housing charities.
The False Economy campaign has published initial results from 265 freedom of information requests issued to councils across England asking about the scale of cuts to charities.
The report shows that over 2 000 organisations are facing budget cuts as local authorities reduce their funding by at least £110 million. Among those suffering are 116 housing and homelessness organisations which have lost £7.4 million. The campaign warns that figures are likely to be much higher once all the figures are finalised.
To see the full results of the False Economy report click here.
[Link2] Are Bonds the Future of Housing Finance?
Places for People, which raised £140m by issuing a retail bond, says the move marks a turning point in the way social housing is financed.
An article in the Guardian Housing Network by David Cowans, Chief Executive of Places for People, explains why.
