Value Added Tax Consolidation Act 2010 section 96

Waiver of exemption under old rules

Section 96 deals with the waiver of exemption from VAT on property lettings under the old rules, and the abolition of that regime by Finance Act 2025.

• Before 1 July 2008, a landlord making short-term lettings (less than ten years) could waive the VAT exemption, thereby charging VAT on rents and recovering VAT on related costs.
• Finance Act 2025 section 74 abolished the waiver of exemption regime: all waivers not already cancelled were automatically cancelled on 23 December 2025, the date Finance Act 2025 was passed.
• No cancellation sum is payable on foot of the automatic cancellation; lettings previously covered by a waiver revert to exempt status, with no VAT charged on rents going forward.
• For Capital Goods Scheme purposes, the adjustment period for any property covered by a waiver ends on the date of cancellation, meaning no further annual CGS adjustments are required after that point.