13 Jun 2018
The tax treatment of charities is complex. Many charities trade either as part of their charitable interests or to raise funds. As a first step, any charity hoping to claim from beneficial tax treatment needs to be recognised as a charity for UK tax purposes by HMRC as well as meeting other criteria.
A recognised charity may qualify for a number of tax exemptions and reliefs on income and gains, and on profits for certain activities. For example, charities don’t pay tax on most types of income as long as they use the money for charitable purposes.
This includes tax:
The VAT rules for charities deemed to be carrying on business activities can be complex. However, certain VAT reliefs and exemptions may be available. Charities are sometimes required to pay tax if they receive income that doesn’t qualify for tax relief or have spent any of their income on non-charitable purposes. Charities are also liable to pay tax on any business activities in which case the same rules apply as to any other business. Charities should pay careful consideration when organising their trading activities. In some circumstances it can be advantageous to establish a trading subsidiary for the charities business activities.
Charities can also claim back part of the tax deducted on donations. Provided all the qualifying conditions are met charities can reclaim the basic rate tax on donations allowing for an extra 25p of tax relief on every pound donated.
Higher rate and additional rate taxpayers (not the charity) are eligible to claim tax relief on the difference between the basic rate and their highest rate of tax.
The Charity Tax Commission has recently launched a consultation to examine the effectiveness of current tax reliefs and to see what improvements could be made. The consultation is open for comment until 6 July 2018.
Vada Studios is a very successful music recording facility. The business had outgrown their existing premises, and had a vision to create one of the top residential recording studios in the UK.
A highly successful restaurant, butcher and retail business.
GJA have been the retained accountants for this property investment and development group for over 20 years. Imminently due to dissolve companies.
Proco approached us with an idea of becoming a distributor of a high-end product in the UK, supplying vinyl nationally.
In 2008 Tom Floate left his employer to set up his own business providing website services. Initially forming a partnership with his wife Rachel, they began trading IO Studios from their home office.
Barry the Butcher is a very successful wholesale butchery and retail business.
Chris works with a diverse profile of owner managed businesses to assist them to grow and retain wealth. Although Chris works with clients from a wide range of sectors, he has particular expertise in property, catering, consultancy and professional services.
Managing Director ACMA
Alex has worked for Grenfell James since 2002 and became a director in 2013. Overseeing our internal operations, he manages the flow of work and ensures we hit our strict deadlines. Alex also manages a portfolio of clients, with expertise in manufacturing and service businesses.
Operational Director MAAT
David has worked for Grenfell James since 2006. He heads up our tax team and is highly experienced with expertise in different industries and sectors.
Tax Director ACCA
Hannah qualified in 2016, having worked for the company since 2009. She acts as a client manager for a range of businesses, with expert knowledge of the equestrian and rural sector. Hannah also manages our payroll team.
Client Manager ACCA
Regent Square Estates
Proco Coatings & Laminates
Mr J McCarthy
Paul Stanley. A S Contracts Ltd.
Mr I Cameron
NPD Design Consultants Ltd
Mckechnies independent tea and coffee bar.
Roy Ferguson. The Perfect Cosmetics Company.
Andrew Knight. The Howard Arms Ilmington
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