At first sight you would expect that a payment called a donation cannot also be a price. The two words are seemingly mutually exclusive. For VAT, "price" implies consideration for a supply. "Donation" implies a payment given to help a wider agenda of doing good and thus not in respect of a supply to its payer. On that basis a "price" is subject to VAT (unless the supply is exempt) whereas a "donation" is not subject to VAT as it is a pure gift.

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When first announced the Seed Enterprise Investment Scheme (“SEIS”) seemed a welcome development for start ups. However on review of its draft legislation one feels that the SEIS (if enacted as originally drafted) is a missed opportunity and falls short of what is really needed to help start ups flourish to support the Government’s growth agenda for UK Plc.

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HMRC has decided to challenge a tribunal ruling which was critical of HMRC’s approach to imposing penalties.

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It is well known that the UK operates a very high VAT registration threshold (which has been the past subject of discussion in my blog for other reasons than the following). Other EU states on average have a threshold in the region of €30k, compared with ours of £73k. This means that, if our businesses make supplies in another EU state (under rules which require them to register there rather than allow the reverse charge to apply to the overseas customer) they will be more likely to be swept up into VAT registration than if an overseas business makes similar supplies in the UK.

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At this festive time of year it is tempting to carry out a bit of entertaining to warm the commercial hearts of others towards our wares. If one's own wares are entertainment, then the spend ranks, arguably, as both entertainment and sampling of the product itself.

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In September I published a blog about the consultation then in progress concerning a VAT exemption for cost sharing between VAT exempt bodies. The purpose of this blog is to provide a brief follow up, in the light of the details published thus far by HMRC on the shape of its likely implementation.

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