Taxation of Grant Income

My client is a CIC involved in activities within local schools, providing support and assistance to young people. Although they do charge fees for some of their work, 75% of their income is in the form of grants from the EC and various charities. They match most of their income with their expenditure, leaving a small surplus of a few thousand pounds.

I am unsure about the treatment of the grant income, whether it is trading income for Corporation Tax purposes. The work they do is altruistic in nature, but the fact they charge for some of their work makes me wonder whether they would be considered to be trading.

If any one has experience in this area I would appreciate some advice

Many thanks

Comments
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CICs are the same as a normal company

James Hellyer |
James Hellyer's picture

But is it trading?

Paul Scholes |
Paul Scholes's picture