Tax payments 'set to increase for charities'

Charities face having to pay new tax bills that could run into tens of millions of pounds as a result of new VAT rules come into force in 2010, it has been suggested.

The Charity Tax Group (CTG) noted that new European regulations that are set to be rolled out on January 1st will mean that such organisations will be required to pay VAT in the country where their services originate, potentially having implications for charity banking organisations, Third Sector reports.

Speaking to the website, John Hemming, tax accountant at the Wellcome Trust and vice-chairman of the CTG, which counts Action for Blind People, Jewish Care and Marie Curie Cancer Care among its members, said that the levies will cover more organisations than one might initially think.

’Anyone who buys services abroad will be caught by this. Charities that hire overseas investment specialists or carry out a lot of work overseas will be the worst hit,’ he commented.
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