VAT relief for fundraising events expanded

Following the landmark Yorkshire Agricultural Society case, HMRC has broadened the scope of VAT relief for fundraising events. Charities can now benefit from VAT exemption even when events serve dual purposes, such as fundraising and education. Provided that fundraising is a genuine purpose of the event, organisations may claim VAT relief even for events that may also look to serve other goals of the charity. This change offers greater flexibility in event planning and could lead to increased revenue retention.

This development really highlights the importance of keeping abreast of tax rulings that impact operational strategy. Finance teams should review past and upcoming events to determine eligibility and ensure compliance with the updated guidance, whilst accountants, auditors and other professional advisers to the sector should look to actively engage with their clients to identify opportunities for efficiencies. With payroll tax increases and cost base increases eating into available resources for charitable purposes, this development offers a real opportunity for the third sector to offset some of that impact as well as potentially opening new channels of engagement with sponsors, service users and the general public.

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If you have any questions, then please feel free to get in touch with Michaela Johns on 023 8046 1256 or email Michaela Johns.