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Post Info TOPIC: Charity auctions
Keith


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Charity auctions
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Hi I  am a Bookkeeper, I have just taken on a non-profit making busines that cares and rehomes animals.  they are striving for charity status. i have been asked to complete their VAT return, I know donations are out of scope.

The question is: They hold online auctions is the money raised in this way  liable for VAT, the items auctioned are a mixture of purchased and donated. confuse Thanks



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leshoward


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The sale of donated goods is zero rated for VAT. The sale of purchased goods would normally be standard rated; although some products will be zero rated.

With regard to input tax, you will be able to recover input tax on goods purchased for resale. However, other input tax will be subject to a Business:Non-Business apportionment, which will make your life a little more complicated. Notice 700, chapter 33 is the place to start.



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Keith


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Thanks for the info Les,  working out the business nonbusiness is going to be a bit if a chalange though.

 



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leshoward


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For some charities, the better way forward is not to be registered at all. Do consider that option, if that is appropriate.

If that is the route that you decide, look carefully at your costs to ensure you are benefitting from such exemptions that are available.



-- Edited by leshoward on Wednesday 2nd of November 2011 09:55:50 AM

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