Charitable Construction

Yarburgh Children's Trust a charity has succeeded in its appeal to the VAT and Duties Tribunal in connection with the construction of a new building. The dispute concerned the trust's right to issue a certificate of zero rating to a builder for construction services provided to it as is permissible under Item 2(a) of Group 5 of Schedule 8 to the VAT Act 1994.

What will be of considerable assistance to both charities and practitioners is the reasoning behind the decision and the willingness of the tribunal to address all aspects of the dispute. The tribunal considered (in relation to construction of a charity building falling within Group 5 of Schedule 8) the relevance of 'economic activity' the meaning of the expression 'village hall or similarly' and the meaning of the term 'local community'.

Background

Yarburgh Children's Trust was formed in 1925 for the...