In this ‘back to basics’ guide, Elizabeth Shanahan (Hogan Lovells) discusses the issues around business, donations and grant funding for charities in a VAT context
No general VAT exemption exists for supplies made by charities. It is a simple point but a number of charities fall into this bear trap. Many charities are aware of the need to pay VAT on taxable supplies made to them but are less able to identify their own taxable supplies. A failure to register for VAT at the correct time can bring with it hefty penalties under FA 2008 Sch 41 and a 20 year window for assessment by HMRC under VATA 1994 s 77. This can be a costly error. This article discusses a number of key points to consider in connection with a charity’s VAT...
