Graham Elliott, director, City & Cambridge Consultancy on membership subscriptions to philanthropic bodies, single farm mapyment entitlement units, rights in conversions, VAT exemption, issues over VAT2 form and default surcharge on wrongly charged VAT
Philanthropic bodies win some reprieve at FTT
Membership subscriptions to philanthropic bodies are exempt from VAT. Cases in the past have sought to define the meaning of ‘philanthropic’ in this context. The latest of these is Halle Concerts Society (TC05067). The First Tier Tribunal held that the subscriptions were exempt owing to Halle being a philanthropic body.
The basis of this decision is that ‘philanthropy’ is a very broad concept, going wider than ‘charitable’. It refers to benefit to mankind, but sees this as applying in a wide range of contexts, including the context of music (of all kinds) and of art, since these help improve the life of mankind.
The tribunal rejected the view that there had to be a direct effect on relieving misery or deprivation amongst people. It remarked that Victorian philanthropists founded universities (for instance) and this gave philanthropy a wider remit than HMRC had contended.
