Following a review of the Charities VAT Compensation Scheme, a maximum claim amount of €1 million has been introduced under the scheme. This is effective for all claims submitted from January 2022.
The Charities VAT Compensation Scheme was introduced in 2018, to reduce the VAT burden on charities and to partially compensate for VAT paid in the day to day running of the charity. A total annual capped fund of €5 million is available for payment under the scheme. Charities are entitled to claim a refund of a proportion of their VAT costs based on the level of non-public funding they receive. Where the total amount of eligible claims from all charities in each year exceeds the capped amount, claims are paid on a pro rata basis.
The maximum claim amount has been introduced following a review undertaken by the Department of Finance, Revenue and charity representative groups. Information about this scheme can be found in Tax and Duty Manual Charities VAT Compensation Scheme.
See Revenue eBrief No. 198/21 for further details.
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