Charities: VAT Refunds

14. What steps his Department is taking to help ensure that charities are able to claim timely VAT refunds.

Having run a capital project myself, I am keenly aware of the importance of good cash flow; I am grateful to the hon. Lady for her question. HMRC receives more than 2 million VAT repayment forms a year, and in 2017, the latest year for which figures are available, over 90% of them were paid within five days of receipt. A supplement is paid if it takes more than 30 days before payment is made, and HMRC also has a free dedicated charities help desk designed to help organisations with their tax inquiries.

4Louis is a charity set up in Sunderland in the memory of Louis, who was stillborn in 2009. It fundraised and built the Louis bereavement suite at Sunderland Royal hospital at a cost of £75,000, some £12,500 of which was paid in VAT. Another suite is planned at Durham at a cost of £100,000 and £20,000 of that is VAT. These huge amounts of VAT could be used by the charity to build another bereavement suite. What advice can the Minister give to it specifically on how it can attempt to get this VAT back?

The hon. Lady will understand that a range of schemes is available for some parts of the charitable sector. We recognise the concern that the hon. Lady is expressing; I cannot deal with individual cases, but obviously if she wants to write to me on the wider issue I will be happy to take it up with HMRC.

A much loved local provider of employment for my constituents with learning disabilities has been forced to consider closure after a change in interpretation of the VAT rules regarding the provision of services under the personal payments arrangements; the retrospective VAT bill of around £150,000 means that Spokes, the trading arm of the charity the Emily Jordan Foundation, faces closure with the subsequent loss of a very important local resource. Will my hon. Friend consider meeting with Chris Jordan on behalf of the charity in order to discuss a way forward that can save this incredibly important local business?

Again, I absolutely recognise the concern, although of course I am not familiar with the details. I cannot get involved in a specific case, but my hon. Friend is welcome to write to me and I will refer the matter to HMRC.