Music festivals should think about charity status, say lawyers

Governance | Tania Mason | 21 Dec 2011

Music festivals should consider registering as charities, according to two of the sector’s top lawyers.

Lawrie Simanowitz and Tom Pratt from Bates Wells and Braithwaite say that festival organisers could cut the cost of tickets by 20 per cent if they were to attain charitable status, because certain events organised by charities are exempt from paying VAT.

If they didn’t want to reduce ticket prices, they could plough the savings back into charitable activities.

BWB has already helped Sunrise Celebration festival (pictured) to register as a charity and is currently advising another festival through the process. Simanowitz said he believed plenty of other festivals could go down the same path but just haven’t thought about it as an option.

Under the registration process for Sunrise, a new charity has been created while the existing festival organisation becomes a wholly-owned trading subsidiary. The trading arm sends the funds raised through ticket sales and stallholders’ fees, back to the charity, which can spend it on charitable activities.

These activities vary from practising meditation to promoting alternative health and buying land for community use.

Simanowitz added that another potential benefit of having the badge of charitable status is that punters might be rather more forgiving towards organisers if things go wrong.

Directory: Bates Wells & Braithwaite

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