Charitable shirts

26 November 2008

Issue: 4186 / Categories: Forum & Feedback

A charity imports shirts to be sold at a concert, which is taking place to raise funds. VAT has been charged on the import of the goods, but can this be reclaimed or set against the sales themselves? The replies confirm that charitable status does not necessarily imply tax exemption.

I was very interested to read Neil Warren's two articles in Taxation recently about VAT issues for charities. I have a client who is a registered charity and the charity is organising a big concert in January to raise funds. The charity is registered for VAT.

As part of the event the charity has imported 500 tee-shirts with the logo of the event typed on the front which will be sold at the concert. However the chief executive is furious because the charity has been charged VAT on the import of the shirts. My client's understanding is that charities can import goods free from VAT as long as they can prove their charitable status. Is there any way the charity can recover this VAT — either directly from HMRC or on their next VAT return as input tax?

Readers' help would be appreciated.

Query 17 314 —...

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