Finance | Bill Lewis | 24 Oct 2008

Bill Lewis discusses the reduced rate of VAT for welfare advice and information.

Readers may call that in the 2005 budget Gordon Brown announced a new 5 per cent reduced rate of VAT for charities and state regulated welfare providers. This would apply where payment is received to provide: "Advice or information connected with or intended to promote the welfare of elderly or disabled people, or children. Examples include child protection videos or expert advice on the welfare of children or the elderly, when provided by charities working in those areas. This reduced rate will only apply where the goods and services are not otherwise exempt from VAT. Therefore the VAT treatment of services of care, treatment or instruction remains unchanged by the introduction of this reduced rate."