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Q: We are a VAT registered furniture manufacturer and make and sell sofas, tables & chairs on which we incur input tax and reclaim this as in connection with our onward sales of these items. We are aware of a local homeless charity that needs items, such as we sell, to help some homeless people when a home has been found for them. Can we donate these items to the charity for them to use in their charitable endeavours without incurring an additional VAT charge (output tax)?

A: Yes. As from the 1st of April 2026 items such as these can be donated to a charity without causing a deemed supply to be triggered, as long as the value of each item is £200 or less. So, if each chair is £50, each table £100 and each sofa £150, then you could donate as many as 30 of each, the total cost would be £9000 but as the individual values are less than £200 there is no output tax to declare. See paras 5.5.4 to 5.5.7 of Notice 701/1 Charities.

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Markel Tax offers expert advice on UK tax and VAT via its helpline and provides monthly FAQs with questions and answers on common tax issues for businesses and practitioners.