Share this content
3

Charity, VAT on rent

Charity client is being charged VAT on their rent

Didn't find your answer?

Search AccountingWEB

A client company which is a registered charity is being charged VAT on their rent.

95% of the space is used for charity's purpose and the remainder is a small office.

Landlord insists on charging them VAT, is there anything that we or they can do?

Replies (3)

Please login or register to join the discussion.

RLI
By lionofludesch
16th Sep 2019 08:20

You're reluctant to post any relevant information about activities but this may apply.

https://www.thirdsector.co.uk/recoverable-vat-rent/governance/article/87...

Thanks (1)
chips_at_mattersey
By Les Howard
16th Sep 2019 09:58

The reference to HMRC guidance is Notice 742A, para 3.5. https://www.gov.uk/guidance/opting-to-tax-land-and-buildings-notice-742a...
The landlord is required to honour such a certificate. It may affect his partial exemption position which is perhaps why he is reluctant to accept it.

Thanks (0)
avatar
By The Dullard
16th Sep 2019 10:27

Before all of that, start with the lease. What does the lease say? If it doesn't mention VAT, then the rent is the rent, and the certificate isn't going to affect the amount of the rent. If the lease is silent on VAT, then the certificate helps the landlord, because he doesn't have to pay 1/6th of it to HMRC, but it will impact his input VAT recovery.

Thanks (0)
Share this content