Sales of X Factor winner James Arthur's charity single 'Impossible' will be exempt from VAT, the Chancellor has confirmed.

The song which has already hit the top of the iTunes singles charts is widely expected to be the Christmas number one and the announcement from George Osborne means that VAT will be waived by the Treasury and instead be donated to Together for Short Lives.

Osborne said: 'Together for Short Lives does a brilliant job supporting families of children with life-limiting conditions. I'm delighted to be able to do my bit to help, handing the VAT back and ensuring that as much money as possible goes to the charity.'

Barbara Gelb, chief executive, Together for Short Lives said: 'This will be a wonderful boost and will help to support the services that provide care to children and young people with life-threatening or life-limiting health conditions across the UK. We work to ensure that children can get the best possible care, wherever they are, and whenever they need it, so families can make the most of precious time together. This generous VAT waiver on the single will make a real difference.'