VAT and charities

There is no general exemption from Value-Added Tax (VAT) for charities. There are, however, specific reliefs from VAT in certain circumstances.

VAT compensation scheme for charities

The Government has introduced a VAT compensation scheme for charities. This scheme aims to reduce the VAT burden on charities. This is achieved by partially compensating them for VAT paid in the day-to-day running of the charity. The scheme applies to VAT paid on expenditure on, or after, 1 January 2018.

You can find further information on the VAT Compensation Scheme in the Companies and charities section.