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VAT on second-hand goods sold by charity shop

Does a charity shop have to charge VAT on the sales of second hand goods it has bought in?

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Hi. My client is a charity shop selling mainly furniture and other household goods and we're clear on the VAT position on the sale of new and donated goods but they have now asked me the following questions:

1. Do they have to charge VAT on the sale of reconditioned stock [white goods] bought in from a co-coperative who specialise in refurbishing and selling on used or rejected goods and
2. If they buy these direct from the manufacturer  i.e. Grade R etc from Hotpoint, Whirlpool etc; are they 'exempt' in that case?

As background, the co-operative has advised my client that they believe my client is exempt from charging VAT on the sale of these items but despite conducting some research of my own, I haven't found anything that blanket supports this assertion. Has anybody any experience of a similar situation to point me in the right direction?

Many thanks.

Replies (5)

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By lionofludesch
02nd Dec 2019 18:37

The co-operative is wrong.

The charity shop has to charge VAT just like any other business with sales above the threshold.

However - there may be scope for some relief under the Margin Scheme. If you're not confident with this, consult a VAT specialist.

Thanks (1)
Replying to lionofludesch:
By Captspar
03rd Dec 2019 14:24

Many thanks, I appreciate your reply. I'd come across the second hand margin scheme in my research but I've been questioning myself as to whether I'd overlooked something else peculiar to their situation, so it's good to have the confirmation.

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By Les Howard
02nd Dec 2019 22:04

Consider the global accounting scheme too.

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Replying to leshoward:
By Captspar
03rd Dec 2019 14:10

Thanks - I'll look into that.

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By bernard michael
03rd Dec 2019 09:59

Whirlpool ?? I hope not

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