Birketts is one of a small number of law firms in East Anglia that can call on an experienced Corporate Tax Team. Furthermore, there are even fewer that can boast the level of expertise that a charity or not-for-profit client will require.
Our team of tax lawyers are fully conversant with the tax and VAT issues that might affect our charity and CASC clients. We help our clients make the best use of tax efficiencies and savings through strategic advice tailored specifically to their individual requirements.
We have particular expertise advising in connection with:
- Selling land for development: Many charities have large endowments of land, such as charitable independent schools and grant-making charities with investment properties, or community charities (such as recreation grounds or village halls). The opportunity to sell part of that land for development might present a significant opportunity to raise considerable funds for the charity. In some cases, this much-needed income can provide the funds necessary to improve other facilities or allow the charity to buy more land in a better location to meet the charity’s purposes. However, this is a complex are of law, and there are a number of tax pitfalls to avoid. For example, anti-avoidance rules that can impose significant tax charges and, therefore, impact on the charities’ future plans. We have extensive experience advising alongside our strategic land and charities team on how to best structure these projects for optimum tax efficiency.
- Construction projects: We regularly advise charities in relation to recovering VAT on building projects, and in relation to specific exemptions that allow the works to be zero-rated. It is essential to get this right, as VAT liabilities can be significant if you do not fall strictly within the rules.
- Sponsorship arrangements: Many charities seek sponsorship from businesses, either generally in relation to the charity (e.g. seeking to be appointed 'charity of the year' by a local business) or specifically in relation to particular fundraising campaigns or events. Depending on what is given to sponsors in return for their money, this might constitute trading from a tax perspective and might also be a VATable supply. However, there are exemptions for certain fundraising events, and we have experience advising on all types of sponsorship and fundraising arrangements.
- Charities and trading: Your status as a charity does not mean that all of your income is automatically exempt from Corporation Tax or VAT. There are complex rules regarding trading activities by charities, and we regularly advise charities in relation to VAT on the supplies they make and in relation to setting up trading subsidiaries for certain trading activities for tax efficiency.
- Tax disputes: We offer tax disputes advice and have a strong track record of representing charity and non-charity clients when they are faced with potentially costly tax claims. The Tax Team has successfully represented clients defending HMRC enquiries at the Tax Tribunals, but is often able to successfully defend or settle an investigation without it getting to court.