Do I really pay 0% VAT on a knockdown rebuild?
Yes, in most cases. HMRC VAT Notice 708 section 3 zero-rates the construction of a new dwelling, including a replacement built after full demolition. The contractor invoices at 0% with a customer certificate, or you reclaim on the DIY route via VAT431NB within 6 months of completion certificate. Single facade retention is permitted only by planning condition; retaining two or more walls breaks the zero-rating.
Do I need planning permission to demolish?
Demolition itself usually falls under permitted development for a domestic property, but you must serve a Section 80 demolition notice under the Building Act 1984 at least 6 weeks before works start. The replacement dwelling itself requires full planning permission. Never demolish before full planning permission for the replacement is in hand.
How long does a typical KDR take from first call to move-in?
Plan for 18 to 24 months elapsed. Roughly 4-6 months for design, planning determination, and finance arrangement; 50-56 weeks for the 8 construction phases (survey, demolition, foundations, shell, first fix, second fix, snag, move). Add buffer for material lead times and weather-sensitive foundation works.
What about SDLT when I sell the existing house and buy back the plot from myself?
You do not sell and re-buy your own plot. The KDR is a continuous ownership scenario: you demolish and rebuild on land you already own. No SDLT event triggers. If you transfer the plot into a different legal ownership (spouse, company), normal SDLT rules apply to that transfer.
Will my mortgage carry over or do I need a self-build product?
Most standard residential mortgages cannot be carried through demolition; the security is destroyed and the lender will recall the loan. You need either a self-build mortgage product (stage or arrears release) or a bridging facility, with a planned exit to refinance on completion. A handful of lenders offer build-on-existing-equity products but these are rare.
Can I live in the house while it is being demolished and rebuilt?
No. A full KDR requires total vacation. Temporary accommodation in the same school catchment for 12 to 18 months is the standard arrangement; insurance rarely covers this for voluntary works.
Does the self-build CIL exemption apply?
Yes, for owner-occupier KDRs. Submit Form 7 Part 1 (claim) before commencement, then Form 6 (Commencement Notice) before any works including demolition, then Form 7 Part 2 after build. Missing the procedural sequence is fatal; the entire CIL charge becomes payable.
What rebuild cost goes on my buildings insurance?
The insurance rebuild cost is a reinstatement figure for an insured peril (fire, flood), calculated via the BCIS/ABI Rebuild Cost calculator. It excludes land and uses like-for-like reinstatement assumptions, so it is materially lower than the price of a voluntary KDR. Update the figure with your insurer at completion.