Services

Charity tax and VAT

Charity tax and VAT services

Our Charities VAT and Tax Team is wholly dedicated to advising charities and other not-for-profit organisations. We have many years’ experience advising a range of clients across different specialisms within this sector.

Our charity VAT services

We regularly provide the following specialist services for the charity and not-for-profit sector:

  • Advising on VAT reliefs and exempt activities for the charity sector.
  • Preparing and submitting VAT returns.
  • Undertaking partial exemption annual adjustment calculations and charity business/non-business recovery method reviews.
  • Charity VAT health checks, including procedure reviews and other similar projects.
  • VAT planning on the purchase of new buildings and considering charity VAT reliefs.
  • Advising on capital investment programmes and the impact of VAT planning structures for a number of public sector institutions.
  • Advising not-for-profit organisations on the effective and efficient management of their VAT affairs, including negotiations of partial exemption and non-business methodologies resulting in significant VAT savings.
  • Providing regular news updates on topical issues and responding to focused consultations.

Our direct tax services

We advise charities on how to maximise the benefit of the exemptions from direct tax.

Charities are exempt from income tax or corporation tax on their income, profits and gains so long as they satisfy the conditions for exemption and the income and gains are applied solely for charitable purposes. We advise charities to ensure they satisfy these conditions and we advise on other tax matters, including:

  • The use of trading subsidiaries.
  • Corporate sponsorship.
  • Property development and refurbishments.
  • Enquiries by HM Revenue & Customs (HMRC).
  • Activities carried on outside the UK, whether trading, investments, fundraising or funding projects.
  • Tax issues relating to employee remuneration and benefits.
  • Tax efficient giving, including gifts from outside the UK.

We prepare tax returns for charities and their trading subsidiaries and we advise on the amount of donation that a subsidiary should make in order to avoid, where possible, any corporation tax arising.

Our Gift Aid services

We provide comprehensive advice and guidance to charities so that they can maximise their ability to claim Gift Aid on donations, including:

  • Donor benefits
  • Gift Aid and fundraising
  • Gift Aid on membership schemes
  • Gift Aid Small Donations Scheme
  • Sponsorship

We undertake Gift Aid health-checks to ensure that appropriate procedures are in place and that record keeping is compliant. We can also assist charities should HMRC undertake a review of their Gift Aid claims.

If you wish to discuss VAT or tax matters concerning charities or other not-for-profit organisations, please contact Russell Moore (VAT partner) or Mark McGarry (tax partner).