Bad News for Charities Looking to Recover VAT on Investment

Following a legal court of Justice from the European Community's recent decision to aid HMRC's view in the case from the University of Cambridge, Sue Rathmell, VAT Director at MHA MacIntyre Hudson, comments that charities need to taking action immediately to assess the impact on their own finances.

Sudhir Singh, Partner and Head from the Not for Profit sector at MHA MacIntyre Hudson added: “No doubt you will see discussions around the intricacies of the judgment within the coming weeks contributing to whether this judgment affects the VAT recovery currently enjoyed by charities on fundraising activities. Any change in HMRC policy in this area might cost charities along with other nonprofit organisations millions. Affected organisations have to review the extent of the VAT recovery on investment and fundraising costs to determine if they desire to make adjustments.”