VAT and Employment

ACRE continues to raise awareness of the need to address VAT issues for village halls; £7 million of investment was lost to irrecoverable VAT on work to village halls in the last five years and many halls are not aware that they are should be paying 5% VAT on their fuel and power bills instead of 20%

Community buildings and village halls with charity status could benefit from tax exemptions or from certain tax schemes, such as Gift Aid and VAT. These could help reduce costs or generate some much needed funds. Managers are advised to check with Her Majesty's Revenue and Customs (HMRC) department to find if and how they can benefit.

The HMRC website has detailed information. If you have any further queries or want to ask for advice you can call the Charities helpline on 0845 302 0203.

66% of halls that responded to ACRE's National Village Hall Survey in 2009 employ a part time or self employed cleaner. 2% employ a full time manager and 2% a full time cleaner. Village hall management committees need to be aware of their responsibilities as an employer. info logo

Further useful information:

Village Hall Information Sheet 6: Village Halls and Registration for VAT

Village Hall Information Sheet 18: Village Halls and VAT on Building Work and other Purchases

Village Hall Information Sheet 26: Coping with VAT on Fuel and Power Supplies

Village Hall Information Sheet 22: Managing Employees and Volunteers

From 2012 all employers will have provide access to pension savings including hall charities where they fulfil the criteria. Make sure you are prepared; you may need to allow for this in your budget.