04/06/2026
Let us clear up one of the most common misconceptions in charity finance: being a charity does not make you VAT exempt.
Charities do benefit from some VAT reliefs, and certain activities are zero-rated or exempt. But if your charity trades, delivers services under contract, or charges fees for activities, you may have VAT obligations you have not accounted for. Failing to register when you should, or incorrectly treating income as exempt, can lead to unexpected bills and penalties.
VAT in the charity sector is genuinely complex, and the rules depend heavily on the nature of what you do and how your income is structured. It is worth taking proper advice rather than assuming. If you have questions about your charity's VAT position, we are here.
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