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Readers’ forum: Should charity register for VAT?

27 January 2025
Issue: 4970 / Categories: Forum & Feedback , Income Tax
Counselling charity

One of our clients is a charity that provides counselling services to adults in the local community. Some of the sessions come via GP referral but other clients will book a session directly online through the charity’s website. The purpose of the sessions is to help a person with their mental health challenges and improving issues linked to anxiety and stress. The sessions are charged at £30 per hour and carried out by qualified counsellors who are remunerated for their services but they are not registered health professionals. If a customer earns more than £30 000 a year the hourly rate for sessions increases by £1 an hour for every £1 000 of annual income.

The charity’s annual fee income is £150 000 and it is not registered for VAT because it is a registered charity with the Charity Commission so the services are – it thinks – charitable...

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