VAT on sub-let commercial property rent

[ManEmp]

I rent a large warehouse building from my landlord. He has chosen to not elect the building for VAT so we are not charged any VAT on our rent payments. We sub-let the space in 100 -200 sq.ft spaces to individual antiques dealers to store and display their stock. Additionally we provide retail services such as marketing, credit card payment systems and a full time employee to be on site from 10am to 5pm every day.

This sub-letting rental income is our only source of income. If we become VAT registered do we need to charge VAT to our antiques dealers on top of their rental payments. Our total income is below the minimum threshold for registration. We would NOT elect the building for VAT.

Thanks. Ken.

[VAT-adviser]

You only charge VAT on the warehouse rentals if you opt to tax. if not, there is no VAT on the rentals. Since your ‘other ‘turnover is below the threshold there is no need to register for VAT. 

[Author]

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