Tax and VAT

Charitable activity is exempt from taxation but charities are not!

You need to be clear about your group’s tax or VAT liabilities. Seek professional advice as early as possible if you’re not sure.

Who can help?

Always contact HMRC for advice about your tax liabilities. It is their advice and opinion that counts. When you call, have as much information available as possible to hand, including expected levels of income, as this may influence their view. Ask for a summary of their advice in writing or by email.

Trading and social enterprise activities are generally subject to VAT and taxation, unless they are clearly designed to deliver your primary charitable purpose.

It is especially important to seek advice if you are signing a contract to deliver services, trading or charging for services.

Useful links

HMRC Charities and Tax – the basics

HMRC VAT for Charities and not-for-profit organisations


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