Payable on goods and services, and within Property Development this is an important cost to consider for Cashflow purposes. Whilst for most Developers the cost is recoverable, there is a lag between payment and the refund, which can be a fiscal drag on Cashflow. Commercial Property investors also need to be aware of VAT. Some Commercial Property owners elect to charge VAT on goods and services related to the property, and when they sell this means they have to charge VAT on the sale. Again, this can normally be reclaimed by the buyer, but it is another cost a buyer has to be aware of. Providing the VAT is recoverable, then most Lenders are happy to fund 100% of the VAT cost.
