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Vat Relief For Organs In Listed Churches


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Now there seems to be light at the end of the tunnel as far as the EU directives on lead are concerned what’s the next issue going to be? Here’s my suggestion.

 

In his budget speech the Chancellor said “On VAT, I will continue to help churches and faith groups by refunding Value Added Tax paid on renovation of church buildings, monuments and other sacred places.”

 

But it seems the scheme is being extended as well as renewed, On the website for the scheme http://www.lpwscheme.org.uk/ we read that “Officials in DCMS are currently reviewing the eligibility criteria for the scheme and further information will be available as soon as possible” Elsewhere it is reported that examples of what the extension will cover include professional fees, bells and organs.

 

I sense another minefield when it comes to defining “renovation” and “organs”.

 

Is tuning “renovation?” Perhaps it’s “maintenance” (not eligible?) But if the organ builder is called in to fix that dodgy pneumatic motor, that would be “repair” - and what if he/she does a bit of tuning while he’s at it… Does that mean two accounts?? Will it cover work to electronic “organs” ? Perhaps not if they are on wheels with a three pin plug - that’s furniture. Perhaps so if you take the wheels off, screw it to the floor and hard-wire it into a spur outlet it becomes a fixture/fitting.

 

On the face of it there would be no test of the worthiness of the instrument – so it would just depend on whether the church it stood in was listed.

That seems a bit unfair on unlisted churches who are the custodians of instruments that would qualify for a BIOS Historic Organs Certificate..

 

Does anyone know how the DCMS officials are getting on? I wonder if they need some help…

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I though VAT was a matter for HM Revenue and Customs, not DCMS?

An understandable thought, which would be correct if the issue were whether work should be zero-rated or exempt from VAT. i.e. if VAT should not be paid in the first place. But here we go, straight into the minefield - or at least into the barbed wire surrounding it!

 

The scheme now being extended to cover organs was started about 5 years ago in an attempt to put right the total nonsense over VAT and listed buildings, where alterations were zero-rated but repairs were subject to 17.5 % VAT. Originally the hope was to zero-rate repairs, but that failed (EU rules I think) so someone dreamed up an alternative way of achieving the same effect for the end-user. Money originating from the Heritage Lottery Fund was set aside, and is administered by the DCMS to refund VAT paid out on repairs to the fabric of listed places of worship. The DCMS also decide just what is eligible. That sounds like a simple and neat solution, but it still needs lots of interpretation. It also means that churches have to find the money to pay the VAT to the Customs and Revenue, and then claim it back from the DCMS.

I am not a VAT expert – just someone who has been involved with lots of work to a listed church over the years…

The key bit of advice for now is to make sure that all VAT invoices for work that might possibly qualify for a rebate are identified and kept. No invoice – no grant!

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  • 4 months later...
Guest Barry Williams
An understandable thought, which would be correct if the issue were whether work should be zero-rated or exempt from VAT.  i.e. if VAT should not be paid in the first place.  But here we go, straight into the minefield  - or at least into the barbed wire surrounding it! 

 

The scheme now being extended to cover organs was started about 5 years ago in an attempt to put right the total nonsense over VAT and listed buildings, where alterations were zero-rated but repairs were subject to 17.5 % VAT.  Originally the hope was to zero-rate repairs, but that failed (EU rules I think) so someone dreamed up an alternative way of achieving the same effect for the end-user.  Money originating from the Heritage Lottery Fund  was set aside, and is administered by the DCMS  to refund VAT paid out on repairs to the fabric of listed places of worship.  The DCMS also decide just what is eligible. That sounds like a simple and neat solution, but it still needs lots of interpretation.  It also means that churches have to find the money to pay the VAT to the Customs and Revenue, and then claim it back from the DCMS. 

I am not a VAT expert – just someone who has been involved with lots of work to a listed church over the years…

The key bit of advice for now is to make sure that all VAT invoices for work that might possibly qualify for a rebate are identified and kept.  No invoice – no grant!

 

This is not 'VAT Relief'. It is an informal grant from the DCMS of a sum equivalent to the VAT paid in certain well-defined and specific circumstances. It is an entirely separate procedure from VAT Zero Rating of work which is under the juridiction The Commissioners for Her Majesty's Revenue and Customs.

 

Barry Williams

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  • 4 weeks later...
Guest Barry Williams
This is not 'VAT Relief'.  It is an informal grant from the DCMS of a sum equivalent to the VAT paid in certain well-defined and specific circumstances.  It is an entirely separate procedure from VAT Zero Rating of work which is under the juridiction The Commissioners for Her Majesty's Revenue and Customs.

 

Barry Williams

 

 

I now have the final version of the Statement from the Department of Culture, Media and Sport about this relief.

 

If anyone would like details, please contact me through Invision in the usual way (with your e mail address) and I will send a copy.

 

Barry Williams

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