VWASS5400 | Supplies made in connection with water and sewerage services: civil engineering works supplied independently of water

From HM Revenue & Customs · VAT Water and Sewerage Services

The policy applies only where the provider of the connection is the same person who supplies the water (or a member of the same VAT group). If the connection is carried out by a third party, the supply will remain standard rated.

However, some supplies of civil engineering works provided in isolation from water can already be zero or reduced-rated under certain circumstances as follows:

Supply	Liability

The first time connection of a new dwelling or relevant residential or relevant charitable building to the water supply if the connection is made as part of the construction of the building.	Zero rated under item 2 of Group 5 of Schedule 8 to the VAT Act 1994.
The supply to a housing association of civil engineering works for connecting a property to the water supply being converted from commercial use to relevant residential use.	Zero-rated under item 3 of Group 5 of Schedule 8 to the VAT Act 1994.
The first time connection to a mains water supply in the course of construction of civil engineering works necessary for the development of a permanent park for residential caravans	Zero-rated under item 2(b) of Group 5 of Schedule 8 to the VAT Act 1994.

(See Notice 708 Buildings and Construction (GOV.UK) and VCONST for further details concerning civil engineering works).