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Churches, charities & VAT
I have over the years supplied signs to various churches and charities.
Today a friend of mine told me that churches and charities are VAT exempt, and I should not be including VAT on any of my invoices for these groups.
Is this correct?
My accountancy software (sage) automaticaly adds VAT to any service invoice I create so even if I was to try and exclude the VAT I couldn’t. Not only that, but how do I keep myself right with the VAT if I am not charging VAT on certain invoices?
I know I should be phoning the VAT helpline for advice on this – but I wondered if anyone else here had come across this.
Whenever I have invoiced charities and churches in the past they have never queried the VAT with me, and have always paid my invoices in full.
Any advice please?
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10 Replies
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Phil charities are generally vat exempt but churches are not, I got caught out by the vat man doing work for a church and not charging vat. Cost me nearly £500. The vat inspector said to me always charge everyone vat unless they show you an upto date vat exemption certificate.
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Mate, wouldn’t the church or charity apply to the tax/vat dept for a rebate? I know here, in the old days, to get an exemption the charity had to give you a tax form with the order, giving them exemption, so you had something to present to the tax dept explaining why you were not paying tax on that invoice.
Otherwise it was your word only, and we all know hoe untrusting the tax industry is don’t we 😮
Shane
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Phil,
Charities and churches are vat exempt in some circumstances, but if you are vat registered, you should always put it on your invoice. It is upto the charity or church to claim it back, The only times a can think off when you can legitamately not charge the vat is when invoicing a company in the EU, providing you have their verified vat reg no., Or if you are invoicing to a company, or individual outside the EU, but again you must have evidence, that the person or company is legit.
If in doubt, always add vat, the exempt can always get it back.
Peter -
I found it best to always make a quick call to VAT helpline, I supplied some exhibition stand to MS Society a while back, I spoke to them about VAT as they are a charity, they said I did not have to charge VAT, when I spoke to VAT helpline, they said that I do have to charge on exhibition stands.
Best check if unsure, better to pay as you go rather than get caught further down the line.Russell.
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I make Peter right on this – charge the vat they have to claim back, EU customers may be exempt but check
John
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You have to charge VAT on all your invoices.
Check for zero rated items, I know 2 they are books and childrens clothes but I doubt you sell any?
Neil 😕
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Hi Folks,
Another item you do not need to charge VAT on is flyers.. You have to charge on the artwork but not for the printed item… don’t ask me why but it is definatly the case.
Cheers
Ian -
More confusing than that Ian I’m afraid.
Printed items are a VAT minefield if your flyer is not on limp paper then it it Vatable also if it is A3 it is Vatable…..if that A3 leaflet is folded to A4 it is zero rated….confusing well yes so they produced Notice: 701/10 to confuse you more.
The limp paper statement was changed from saying 160gsm as it depended on the type of paper stock, this statement solved the argument but as usual created more.
Plenty of PDF’s available to download on http://www.hmrc.gov.uk/
Tim.
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Hi guys, my first post, however, I have had a little experience with VAT and Registered Charities.
The bottom line is that it depends who’s space they are advertising in. If they are advertising in their own space they have to pay VAT, if they are advertising in someone else’s space it is VAT exempt.
My company provided and fitted Christmas Panto banners fixed to the Charities premises, and to lamp posts around the town, in this instance VAT was only chargeable on the banners fitted to their building.
We raised this question during a VAT inspection, and the inspector could not advise, however, stated that it was our responsibility to charge the VAT correctly. I spent several hours with the VAT help line to get the above answers.
(as if we haven’t got enough to do as small businesses!!).
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I often apply the reflective stripes on the “St John Ambulance”” vehicles.
Their head office always send me an order No with the vat exemption certificate (a copy of).A4 / A5 Leaflets are vat exempt as already stated EXCEPT if you have to include a box or dotted line that has to be filled in by whoever.
Business cards you have to charge vat on as the vat man states that people write on the reverse side of, what about cards that are printed on both sides i asked (nowhere to write on) there answer was doesn’t matter they are still business cards.
In other words they always win.
L J
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