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THEATRE SHOW - HIRE - VAT PAYABLE ON TICKET SALES

THEATRE SHOW - HIRE - VAT PAYABLE ON TICKET SALES

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Hi, would really appreciate your help on this

I put on shows at various theatres, mostly on 'split deals' where the revenue is split 75%/25% in my favour after VAT.

However the best feeling of these show is calculated on a hire where the hire cot is variable at around 35% of the gross sales, no VAT being payable because its a hire. But VAT is charged to me on the hire cost. (I make more this way than the 75%/ 25% split ayer VAT and so do the theatre).

Im am strongly considering voluntarily registering for VAT as I pay it out on various costs and could claim around £450 a month back by my calculations.

My question is that if I do register for VAT do the tickets sales then become VAT-able even though its on a hire?

Please help, thank you.

Replies (9)

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Portia profile image
By Portia Nina Levin
22nd Dec 2014 15:45

I do not really understand what you are saying

But yes, the supply of a right to admission to an event in the UK is a taxable supply, unless the cultural exemption applies (which it will not if you are seeking a profit, as you seem to be).

If the theatres are not charging you VAT for the use of the theatre, then they are doing so incorrectly, because they are not supplying you with a simple right over land. They are supplying you with the facilities of a theatre (stage, curtains, lights, and seats to put punters bums on), which should be standard-rated.

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By bigdaddy
22nd Dec 2014 16:57

Thanks Portia.

For all events organised with a room hire in the UK vat is not payable/ chargeable for non VAT registered businesses on the ticket sales. The theatre DO change Vat on the supply (room charge). My question is: Does me registering for vat change the vat position on the ticketsales?... 

Thanks

 

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Portia profile image
By Portia Nina Levin
22nd Dec 2014 17:13

Yes

I think. Still not completely clear, but I cannot think of a situation where you would not be making a taxable supply.

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By The VAT Doctor
27th Dec 2014 21:19

PNL

I am not dreaming, I agree with PNL, though many theatres do exempt the hire still, some armed with old HMRC rulings...before they realised they were wrong.

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By bigdaddy
28th Dec 2014 00:28

Ok, thanks very much PNL and VAT DR!

Could you let me know how much you charge for VAT services?

I'll have to register from 5th Aril and I think (perhaps niavely) my returns should be relatively simple/ straight forward...

 

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By nick farrow
29th Dec 2014 11:58

are you agent or principal in these transactions?

my understanding of these situations is that you as the promoter are making the supply to the punters in return for the gross box office receipts less the venue's charges which will almost always have VAT applied.

Whether you have to account for VAT on the net box office receipt will depend not only on whether you are (or should be) VAT registered or not, but also on whether you are actually acting as principal or agent in the deal with the performer. if you acting as agent then then the principal i.e. the performer would have to account for VAT on the next box office receipt - I think but I may be wrong

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RLI
By lionofludesch
29th Dec 2014 12:45

Agree with Nick

Key question is "Who is making the supplies of tickets to the general public ?"

Much depends on the contracts between the parties.

Either way, I can't see much point in you registering unless you have to.

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By bigdaddy
30th Dec 2014 12:36

Thanks Nick and Lion

I think Im classed as principal and the theatre as agent. 

It would appear (I think) that if I register, even on a hire, VAT becomes payable on ticket sales. 

Its already payable on split deals but Ill wait till April till registering. 

Thanks everyone much appreciated!

 

 

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By Qskhr
07th Sep 2015 23:21

VAT on theatre hire when it's used as a non ticketed venue

Hi

Would love advice on this. We hire a theatre weekly for our church congregation to meet in. So no tickets sold or money made. Is VAT still able to be charged to us on the hire cost? 

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