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Posted Thu, 16 Jan 2025 15:49:04 GMT by PakenhamVHA Speare
As a committee member of our Village Hall Association (a Registered Charity) I am seeking clarification as to whether we qualify for a Zero rate certificate for the proposed new Pavilion in our village.
There is an existing structure that has been in place for over 30 years that we intend to completely demolish and then rebuild on the same site.
The Pavilion is currently, and will remain, a multi-use community space that is never used for business purposes.
As far as I have read, it seems clear that we would qualify for 0% VAT on the construction of the new Pavilion ?
We are being “recommended” to “invest” over £3500 in a Consultancy firm to “advise us” as to the right path on this.
I feel loathed to do this as we can put that money to much better use in our Community, but at the same time, don’t want to be totally complacent about this matter.
Your advice would be most gratefully received.
Thank you
Posted Fri, 17 Jan 2025 14:23:44 GMT by Jay Cooke
HMRC are not going to give you an answer on a public forum.
You can write to HMRC and request a "non-statutory clearance" where you will write with site plans, diagrams, detailed explanation of what use the new building will be put to, etc.
Link below https://www.gov.uk/guidance/non-statutory-clearance-service-guidance
What do you mean by "Multi-use", the word "pavilion" usually suggests a sporting (cricket), which would suggest the primary purpose is of a cricket ground, so do you charge a rent or fee for accessing the sports pitch?
HMRC internal manuals make comment on village halls and sporting facilities https://www.gov.uk/hmrc-internal-manuals/vat-construction/vconst16600
You may also want to Google "sports pavilions", VAT tribunal" and that should list a variety of websites which highlight various VAT tribunal cases, I can't link you to them here as only HMRC links can be placed into posts, but be mindful that each case is unique to its own facts. You state the village hall will never be used for business purposes, so that would suggest you do not charge a fee for use of the hall, so how does the charity generate income, is it all donations?
Point being, be careful with the definition of "non-business", even if you just charge a nominal peppercorn fee then HMRC may still see that as business.
Not saying the village hall cannot be zero rated but as Trustees of the charity you have a fiduciary duty, so whilst you may think you are "saving" £3k on consultancy fees, the risk is if you spend say £100k on a new build, then if you get this wrong, the charity will be potentially on the hook for £20k VAT so consider all he risks not just the savings. I think £3,500 is a little on the high side though.
Posted Sat, 18 Jan 2025 10:00:01 GMT by PakenhamVHA Speare
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Posted Thu, 23 Jan 2025 06:05:11 GMT by HMRC Admin 25 Response
Hi PakenhamVHA Speare,
If the conditions are met as below then the demolition and construction of a new relevant charitable purpose building can be zero rated:
3. Zero rating the construction of new buildings 3.1 The conditions
Buildings and construction (VAT Notice 708)
Thank you.

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