Commentary

V7.463 Charities—trading subsidiary company

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.463 Charities—trading subsidiary company

Part V7 Tax planning | Commentary

V7.463 Charities—trading subsidiary company

Charity law does not allow a charity to carry out a significant amount of 'non-primary purpose trading' as a way of raising money, eg sale of Christmas cards. In such cases, the charity usually forms a separate trading subsidiary company which, although controlled by the charity, is not an actual charity. As a result, some of the VAT reliefs available to a charity are not available to subsidiary trading companies.

Example – a subsidiary trading company can still zero-rate the sale of donated goods to the public, and income from a fundraising event is still exempt from

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