HMRC has confirmed that it is extending the transitional period during which the retrospective VAT concession on charities’ direct mail will apply to 31 July 2015, four months after the scheduled start date of 1 April 2015. This follows a letter from HMRC to the Direct Marketing Association in July 2014 outlining clarification on whether mail packs should be treated as a single composite supply of zero rated delivered goods (as widely believed in the industry sector and confirmed in numerous rulings from HMRC officers) or a supply of standard rated direct marketing services.
HMRC officials confirmed that they believed it was the latter and sought to implement the new arrangements by 1 October 2014. Charities and direct mailing companies have since sought clarification on the past and future VAT treatment of their direct mail arrangements. HMRC is currently planning to publish a Revenue & Customs Brief explaining changes to VAT Notices 700/24 and 701/10 on 5 June 2015.
John Hemming, chairman of the Charity Tax Group, welcomed HMRC’s decision to extend the transitional period until the end of July.
HMRC has confirmed that it is extending the transitional period during which the retrospective VAT concession on charities’ direct mail will apply to 31 July 2015, four months after the scheduled start date of 1 April 2015. This follows a letter from HMRC to the Direct Marketing Association in July 2014 outlining clarification on whether mail packs should be treated as a single composite supply of zero rated delivered goods (as widely believed in the industry sector and confirmed in numerous rulings from HMRC officers) or a supply of standard rated direct marketing services.
HMRC officials confirmed that they believed it was the latter and sought to implement the new arrangements by 1 October 2014. Charities and direct mailing companies have since sought clarification on the past and future VAT treatment of their direct mail arrangements. HMRC is currently planning to publish a Revenue & Customs Brief explaining changes to VAT Notices 700/24 and 701/10 on 5 June 2015.
John Hemming, chairman of the Charity Tax Group, welcomed HMRC’s decision to extend the transitional period until the end of July.
