Free guide
The charity VAT primer
How UK charities and their advisors can untangle business, non-business, exempt, and taxable supplies — and recover what they're entitled to.
Last reviewed: 23 June 2026
What's inside
- 1
Why charity VAT runs on three planes — non-business, exempt business, taxable business — and why the rules interact
- 2
The four traps that catch new finance teams: grants vs contracts, the 15-events rule, special method approvals, de minimis
- 3
How OneSixth supports the full business/non-business + partial exemption sequence
- 4
The 25% charity discount on OneSixth pricing and how to claim it
- 5
Three ways to engage if you want to take a closer look
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Common questions
Why is VAT so complicated for charities?
Charities operate across three planes at once — non-business (outside VAT), exempt business, and taxable business — and most costs touch more than one. Recovering the right input VAT means splitting business from non-business first, then applying partial exemption to the business part.
Are grants subject to VAT?
A genuine grant or donation, where the funder gets nothing in return, is normally outside the scope. The trap is that many "grants" are really contracts for services — if the funder receives something of value it may be a taxable supply.
What is the 15-events rule?
The VAT exemption for charity fundraising events doesn't apply if you hold more than 15 events of the same kind at the same location in a financial year; exceeding it can make those events taxable.
Can charities recover VAT on their costs?
Only on costs relating to taxable business activity, after the business/non-business split and any partial exemption restriction. VAT on purely non-business or exempt activity is generally irrecoverable, though specific reliefs and refund schemes exist.
Does OneSixth offer a charity discount?
Yes — a 25% charity discount on OneSixth pricing. The guide explains how to claim it and how OneSixth supports the full business/non-business and partial exemption sequence.