A commercial sports facility receives a grant from a local charity to run a project whereby children get to play some sports activity (not sure exactly what, but I think it's soccer).
Is the grant income to be included in Flat Rate turnover or is it outside the scope?
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Is the grant to provide assistance in running the project, or is it obliged to run the project (perhaps with a service level agreement) in exchange for the grant funding.
Essentially it is either consideration for a supply (and thus part of your FRS turnover) or it is not.
VAT is not charged on receiving a bit of cash. VAT is charged on supplies, which are generally valued by reference to the bit of cash received.
Yes but the project not being viable without the money is not the same thing thing as having to undertake the project to get the money.
Let us say that I am an expert in the ancient craft of voodoo (did you feel that by the way?) and I have decided to run voodoo classes, but because it is not economically viable I approach the council for a bit of funding, which is forthcoming. Off I go and teach voodoo to wayward teenagers. No supply.
On the other hand, if the local council, knowing that I am a voodoo sage (apologies for using the S word) approach me and say, "Portia, if you run a course of voodoo classes, we will give you £X", then when I teach the wayward youths voodoo, there is a supply. It does not really matter to whom.
The difference is that under the second option I have an obligation to teach wayward youths voodoo, in exchange for which I receive funding.
Under the first option I am able (but not obliged) to teach the spotty oiks voodoo because of the funding, but that does not make it consideration for any supply.
There cannot be a supply of services without consideration.