VAT
For most small projects and organisations value added tax (VAT) will not be an issue. You will have to pay it when you buy things and will be able to recover it, and you will not be VAT registered and therefore need to charge VAT for any services or supplies you charge for.
If this is the case you must remember to include VAT on all the costs in the budget.
For bigger projects and for organisations whose turnover requires them to be VAT registered the picture is a bit more complicated. In these cases you may have to submit budgets that are exclusive of VAT (that is the expenditure and income must be in the budget without the VAT included) and you may also have to include information about how much VAT you will be able to recover.
Perhaps the most complicated situation is where you are a small organisation, where VAT is not currently an issue, applying for funding which will increase your turnover so that you will be liable for VAT.
It is beyond the scope of this website to provide detailed information and advice about VAT. So if you have any concerns please contact the National Advice Service (0845 010 9000)
or visit the HM Customs and Excise website.
