Calculating VAT can be an incredibly complicated process for charitable organisations. Therefore, it is no surprise that mistakes are commonly made among charities that fail to recognise they are applicable to many of the same rules as regular businesses. Further to this, The Office of Tax Simplification has initiated a review into the application of VAT with respect to reliefs and exemptions and as a result the House of Commons Treasury Committee has launched an inquiry into tax after coronavirus.

The Charity Tax Group (CTG) have commissioned new research, carried out by London Economic, on the impact of VAT on charities, specifically in relation to irrecoverable VAT and existing reliefs available to charities. CTG will be presenting a new report with their findings through a virtual event taking place on Thursday 3 December 2020, at 16.00. Within this event, CTG will present the research that has been undertaken, as well as their resulting conclusions and setting out their recommendations to the Government for any future VAT reform.

Any charitable organisation should use this review into the impact of VAT on charities as an opportunity to clarify their VAT position, ensuring they are paying what they need to as well as making the most of the reliefs available. At The VAT People, we offer a ‘health check’ service to assist charities in navigating VAT legislation effectively and so if you work on behalf of a charity and want to ensure all VAT obligations are being met, please call our helpline for free advice today.