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Should VAT be charged on membership fees?

Are membership fees for an arts organisation which is a SCIO subject to VAT?

 I am finance officer for a small charity which operates an arts centre includinga  theatre, music venue etc. Shows are open to the general public but members can obtain a discount on the ticket price. I maintain that because there is a benefit which has a monetary value that we should charge VAT on the membership fees. The director of the music venue disagrees. As usual, HMRC guidelines are not easy to follow. Can anyone clarify the position for me and perhaps point me to the relevant HMRC documantation?


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07th Dec 2018 14:45

Take professional advice. It's a tricky area and neither of you are experts, so don't risk your income by trying to save a bit of cash now.

They should be able advise you on the most efficient structure/wording/policy to maximise income and keep the right side of HMRC

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07th Dec 2018 14:49

Do seek professional advice.
For your reference, HMRC Notice 701/5, chapter 12 refers to the possibility of exemption for certain membership organisations.

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to leshoward
07th Dec 2018 15:15

It's still a moving target and there are complicated interactions with eg Gift Aid. This was a very expensive case for the organisation concerned

IIRC if the 'members' are not actually voting members of the company/CIO they may not be eligible for that (minor) concession

Bit of a minefield...

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