VAT: property development for charitable bodies

There are no general exemptions or reliefs from VAT for organisations in the Not for Profit or charitable sector. There are however various specific reliefs when it comes to land and property transactions but these are generally limited by reference to the ‘use’ or ‘purpose’ to which the land and/or property is to be put.

For VAT purposes VAT reliefs apply to ‘charitable bodies’ which have a much broader definition than ‘charity’. Many readers will be aware that charitable bodies are able to construct or purchase new buildings without a charge to VAT ie zero rated; as long as the building is to be used solely for charitable purposes.

This relies on the charitable body meeting the relevant conditions ie intended for use solely...