|
|
Calling
all theatres
There is a VAT exemption for ticket sales by non-profit-making theatres and other "cultural bodies", as long as the management is voluntary. A recent case involving London Zoo showed that it is the top level of management - the Board - who have to be volunteers. The managers who run the business from day-to-day can be paid.
This seems like a good thing, but it's a big concern to many small theatres - being able to charge VAT on ticket prices means you can get back VAT on your costs. If you don't charge VAT, you can't. If a small theatre raises money from grants and donations in order to fund a big building renovation, it won't save much by exempting the tickets, but it will lose a lot of VAT on the building work.
Customs have recognised that this will give affected organisations some difficulties, and have announced that they will apply the rules in quite a favourable way. For example, if you have already contracted for the building work on the basis of the old understanding, they will allow you to claim back all the input tax on it - even though you won't have to charge output tax on your tickets. But if you are planning something in the future and haven't got as far as booking the builder, you may have a problem.
If you are affected by this change, we will be happy to discuss the details with you.
|
