Saving VAT – Good News for Churches
The Government has announced an extension to the Listed Places of Worship Scheme which will take effect from 1 October 2013. The Listed Places of Worship Scheme makes a grant available towards the cost of the VAT on building work for listed places of worship.
More churches will be eligible to claim from 1 October 2013 when works to pipe organs, bells and bell ropes, and turret clocks may be included for claims under the scheme. Just as importantly professional fees will also become eligible when directly related to eligible building work. This reverses a previous change which forced local communities to find the additional cost of VAT on services such as architect’s fees.
In addition to these changes to the scope, administrative changes should simplify the claim procedure. This will allow applicants to make one claim every 12 months for eligible invoices totaling between £500 and £1,000. This is in addition to an unlimited number of claims for work of £1,000 or more. There will no longer be a requirement to send the original invoices, and weekly payment runs will help to ease the cash flow for cash-strapped communities.
These very welcome changes show that the Government has listened to the concerns of communities struggling to maintain listed buildings for the benefit of the nation from the donations of individual households. The fixed budget for this grant scheme was increased in 2012-13 to £42 million with the intention of eliminating the lottery of the previous year where churches had to submit claims with the hope of reclaiming all of the eligible VAT only to find that they received less than 50% when the number of claims in the quarter went over the budget available. It is no surprise that taxes raised by stealth on charitable donations are unpopular.
More information about the Listed Places of worship Scheme is available at http://www.lpwscheme.org.uk/grant_scheme.htm