Sector summary ― charities

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance

Sector summary ― charities

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance
imgtext

This guidance note provides a summary of key VAT issues of relevance to the charity sector.

Areas covered include:

  1. an introduction to the sector

  2. the VAT meaning of a charity

  3. business and non-business activities

  4. the link between supply and consideration (including grants, donations and sponsorship)

  5. the VAT liability of a charity’s business supplies

  6. registering for VAT

  7. VAT reliefs for charity expenditure

  8. land and property

  9. the implications of incorrectly claimed VAT relief

  10. VAT recovery — including non-business expenditure, partial exemption and the charity special refund scheme

  11. key case law

Introduction to the sector

Amongst non-VAT specialists there is sometimes, an assumption that charities do not pay VAT or are not really affected by VAT. This assumption is false.

The charity sector faces some of the most complex VAT issues of any part of the economy.

In addition to other considerations, a typical charity will have to make difficult technical decisions about:

  1. whether income is derived from a ‘business’ activity

  2. the

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
Powered by Tolley+

Popular Articles

Residential property and capital allowances

Residential property and capital allowancesResidential property ― plant and machinery allowancesOrdinary residential property does not, and never has, qualified for capital allowances. as CAA 2001, s 35 denies plant allowances for expenditure incurred in providing plant or machinery for use in a

14 Jul 2020 17:14 | Produced by Tolley in association with Martin Wilson and Steven Bone Read more Read more

Relief for employee share schemes

Relief for employee share schemesRemuneration expenses are generally deductible for corporation tax purposes as they are considered to be incurred wholly and exclusively for the purposes of the trade. However, expenses relating to shares are usually classed as capital and are therefore not

14 Jul 2020 13:21 | Produced by Tolley Read more Read more

Indexation allowance and rebasing

Indexation allowance and rebasingThis guidance note explains the general rules surrounding the availability of indexation allowance (which was frozen at December 2017) on the disposal of company assets and provides information on the rebasing rules for assets held on 31 March 1982. For an overview

14 Jul 2020 11:59 | Produced by Tolley Read more Read more