Hello
A charity client of mine runs fundraising events such as football competitions/family activity days etc which i believe are exempt from vat (subject to the 15 event rule). It also has a fully owned trading subsidiary through which it "sells" sporting services such as canoe lessons, summer schemes, outdoor activities, wall climbing etc to paying customers.
Am I correct in advising them to put the fundraising through the charity, all exempt from vat, and put the sporting services through the trading subsidiary and charge standard rate vat?
Many thanks
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Replies (3)
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I'd have thought...
... that your trading subsidiary would satisfy the definition of an "eligible body" for the exemption in item 3 of Group 10 of Schedule 9.
Hmmm I had thought of that but since the manager only draws a salary when the trading subsidiary makes money I'm not so sure - it may be caught under the commercial influence clause. We dont want it to be exempt as the company wants to claim vat back on assets. What do you think?
Exemptions apply automatically
So you want to ensure you breach it. Is the manager an "officer" of the subsidiary? That would cause the exemption to fail.