IPA comments on HMRC charity advertising VAT changes

HMRC has revised its interpretation on the eligibility of five types of advertising for the zero rate of VAT.

The IPA has welcomed HMRC’s revised interpretation of the VAT legislation as it relates to supplies of digital advertising to charities. HMRC has said it now considers that re-targeting, behavioural targeting, demographic targeting, audience targeting and lookalike targeting are eligible for the zero rate of VAT.

Says David Clasen, Finance Director, IPA:

"HMRC's reconsidering its stance on these five types of advertising is good news. Charities’ budgets will stretch further as a result and this allows for knock-on beneficial effects for agencies working with charities.

"We are delighted with this development but note that there is still work to be done to get to a clear position respecting the original intent of the reliefs for charities. We shall continue to talk to DCMS and the Charity Tax Group on this matter."

Last updated 21 September 2020