Is meeting room rental VAT exempt?

Is meeting room rental VAT exempt?

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One of our clients own a large commercial building which is used for holding meetings, weddings, parties etc.

Can anyone point me in the direction of HMRC information on the VAT treatment of such income.  I realise that usually rent is treated as exempt for VAT purposes however I want to confirm that this includes meeting/function room rental?

Their turnover is aproaching the magic VAT figure so I want to confirm the status of the income to ensure they do not miss registering if needed. And obviously not if the rent is indeed exempt.

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Rebecca Benneyworth profile image
By Rebecca Benneyworth
13th Jan 2010 19:26

Care needed

Hire of the bare room would be rent and therefore exempt. This may not be the right answer as he may find that he can't claim back VAT on any repairs or other expenses in relation to the property so he might want to opt to tax in any event. This would make the room hire fees standard rated.

However, if he is also supplying catering for the events - he provides the food etc then the room hire is regarded as a supply in connection with the supply of catering and therefore standard rated, as it is really part of the catering rather than room hire.

Bare room hire and teas / coffees for meetings billed by the cup (standard rated) would still be VAT exempt normally provided the tea and coffee is a separate optional extra and not mandatory / included in the price.

The HMRC guidance on this is very brief - VAT Notice 709/3 at section 4.1 - LINK.

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