Entries by VATDaddy

VAT zero rate for reading material

Charities and their advisers will be aware of the favourable zero rate VAT regime for reading material that has applied in the UK since the days of purchase tax.  They will also know of the seemingly illogical stance of HMRC that this relief only applies to old fashioned physical print formats and not to modern […]

VAT on matchmaking

Art or science? If you want to research what actually happens in certain walks of life, VAT tribunal reports are a treasure trove. We learn about the purpose and activities behind pilates (Hocking [2014] UKFTT 1034), belly dancing (Cheruvier [2014] UKFTT 7), fortune telling (Indian Palmist (2003) VAT Decision 18397), and several more. To this, and the others, […]

Risk of Supporters becoming responsible for VAT

It is quite common in charity circles for helpful supporting individuals to become involved in assisting the charity in various ways.  In some cases a fundraising event, such as a golf day, might be organised, year on year, by the same individual, all the proceeds of which go to that charity.  Or a group of […]

Whether a structure is an Annexe – Yeshivas Lubavitch Manchester case

I have previously commented on the Yeshivas Lubavitch Manchester tribunal case in the context of whether a proposed use of a building is a ‘relevant charitable purpose’. However, the case also concerned whether the works in question created an ‘annexe’ as distinct from an ‘extension’ to an existing structure. For the zero rate to apply to the works, this […]

Eynsham Cricket Club VAT case – Another update

I wrote a commentary on the curious case of the CASC that claimed it was a charity in order to benefit from charitable VAT relief on new building works.  That related to the First tier Tribunal decision in Eynsham Cricket Club.  This has now returned to the courts in the form of an Upper Tribunal decision (UKUT0286).  The tortuous […]

Defining ‘Protection’ for the purposes of the VAT Welfare Exemption

This commentary focuses on one of the defining planks of the ‘welfare’ exemption which applies (amongst others) to charities.  The relevant provision relates to the ‘care or protection’ of children or young persons.  The review is prompted by the Tribunal decision in Lilias Graham Trust (TC07346).  Whereas the facts will be special to that charity (which has […]

HMRC loses £1m VAT case against Scottish farmer

In a judgement issued on 29 July, the court said taxpayers can deduct VAT incurred in purchasing the rights to a subsidy, in this case entitlements to Single Farm Payments (SFPs). HMRC had refused to allow the farmer, Frank A Smart & Son Ltd (FASL), to deduct VAT of £1,054,852 in its returns between December […]

Relevant Charitable Purpose for Nurseries? Review of the Yeshivas Lubavitch Manchester VAT case

In the wake of the court decisions in Longridge and Wakefield College we were wondering where the newly stricter conditions for defining ‘relevant charitable purpose’ left children’s care charities that had relied on the ancient precedents of Yarburgh and St Paul’s.  HMRC did not withdraw their policy to the effect that such ‘creche’ charities could be regarded as carrying out relevant charitable purposes […]

Does VAT exemption for ‘welfare services’ extend to provision of a payroll service? Cheshire Centre for Independent Living case

Cheshire Centre for Independent Living (‘the charity’) has been involved in a long-running dispute with HMRC over the VAT treatment of charges made to disabled persons in running a payroll service.  The scenario arises as follows. A disabled person may need a carer.  Where possible… To read more… click here