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Readers forum: Charitable purposes

10 March 2020
Issue: 4735 / Categories: Forum & Feedback
VAT on a building used for a youth club.

My client is a youth club which is registered as a charity. It is buying a building which will be used for the club’s activities. However the building owner had opted to tax the building so in the normal course of events VAT would be charged on the sale price.

The charity must give the seller a letter confirming it is exempt so VAT does not have to be charged but the lawyers advising it have some doubts and think VAT should be charged on 5% of the purchase price being the proportion of the building that office administration would occupy.

In essence the building will be open-plan but there will be some desks and computers where the charity’s records will be kept. The administration work carried out in the building is the planning and recording of youth activities applying for...

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