Is there VAT on charity appeal letters and donation envelopes?
Charity appeal letters and donation envelopes are usually zero-rated (0% VAT) in the UK, but only if they meet HMRC's conditions: supplied to a charity; A letter whose main purpose is asking for donations, not just a form to fill in; envelopes over-printed with the appeal, or clearly different from the charity's usual stationery; not the charity's general stationery (HMRC VAT Notice 701/58, paragraph 6.1).
PRIVATE & CONFIDENTIAL
A good cause.Zero-rated.I am not entirely without feeling.
Charity appeal letters and donation envelopes
0% VAT
An HMRC concession zero-rates the printed stationery a charity uses to ask for money: appeal letters (even personalised ones) and the envelopes that go out and come back with them.
HMRC VAT Notice 701/58, paragraph 6.1
0% as long as it's:
Supplied to a charity
A letter whose main purpose is asking for donations, not just a form to fill in
Envelopes over-printed with the appeal, or clearly different from the charity's usual stationery
Not the charity's general stationery
Need these printed?
Tell Tenfold the quantity, size and deadline. We'll put together a quote for your job.
Why are charity appeal letters and donation envelopes 0%?
This sits outside VAT Notice 701/10 entirely. It is an extra-statutory concession in the charities notice, and 6.1 lists exactly what it covers when supplied to a charity: collecting envelopes that ask for donations of money, stewardship envelopes for planned giving, pre-printed appeal letters primarily aimed at seeking money for the charity, and the envelopes used to send those letters out and to send donations back, provided each type is over-printed with an appeal request related to the letter or is otherwise distinguishable from the charity's usual stationery. HMRC is clear about the boundary: the relief does not cover general stationery supplied to charities. It is also clear that an appeal letter must be a letter and not just a form to fill in and return, and that it does not matter whether the addressee's details are on it.
What decides it?
Whether the item is asking for money for the charity, or is just the charity's stationery.
When would charity appeal letters and donation envelopes be charged at 20% VAT?
The zero rate applies as long as it's: supplied to a charity; a letter whose main purpose is asking for donations, not just a form to fill in; envelopes over-printed with the appeal, or clearly different from the charity's usual stationery; not the charity's general stationery. If any one of those isn't true, it isn't zero-rated, so it's 20%.
Is the design and artwork for charity appeal letters and donation envelopes zero-rated too?
If your printer does the design, typesetting or finishing as part of the same zero-rated print job, that work can be zero-rated too. Design bought separately from a studio is a standard-rated service.
Where does this come from?
HMRC VAT Notice 701/58, paragraph 6.1, HMRC's guidance on goods or services supplied to charities. See the notices we work from.
Some real jobs
Pre-printed appeal letters for a charity, each personalised0%
6.3 says it does not matter whether the addressee's details are included when supplied to the charity.
Outer envelopes over-printed with the appeal0%
Envelopes for sending out appeal letters qualify where they are over-printed with a related appeal request.
Stewardship envelopes printed with the name of the place of worship0%
6.2 zero-rates stewardship envelopes clearly for a planned giving scheme and printed with at least that name.
The charity's ordinary letterhead and compliment slips20%
The relief does not cover general stationery supplied to charities.
