A change in the tax rules introduced by HMRC in January was introduced to put an end to universities renting designated student accommodation, which is exempt from VAT, during holiday periods. Long standing HMRC rules have allowed higher educational institutions to benefit from a zero VAT rating on the construction of a building 'intended to be used solely (at least 95%) for a relevant residential purpose'.
From the 1st April 2015 HMRC will withdraw the concession for use during holiday periods. After consultation with affected parties, HMRC has amended the rules to state that student projects that are not complete as at 1st April 2015 will still be able to rely on the zero VAT rate under certain circumstances.
The full review and further information can be found on the .gov website here.