Is your church paying reduced VAT on its energy bills?

Under the Finance Acts 1993 & 1997, charities and not-for-profit organisations are entitled to a reduced VAT rate of 5% (instead of 20%) on their bills for energy used for ‘non-business purposes’. This is a significant reduction, so worth checking if you are unsure.

Don’t forget there’s also an exemption from the Climate Change Levy (CCL), currently set at 5%.

This is a government tax introduced in 2001 on the use of energy, including gas and electricity, by businesses, agriculture and the public sector.

Check your gas and electricity bills to ensure this is not being charged.