Hi everyone!

We are a swing dance organisation that is a Community Interest Company, which means we are not for profit, but not a charity either. We've recently had to deal with VAT registration and the frustrations of determining which the most efficient rate for us would be, as our accountants did not seem to have a definitive answer. 

We were initially told we could apply for the discounted flat rate scheme (8.5%), however that requires us to be purchasing goods for the business equal to 2% of our quarterly turnover or £250, whichever is higher. We do not work with goods as such, our expenses are all on venue hire, teachers and their expenses on travel/food/accommodation (who class as suppliers and not customers), so cannot be treated as part of our spendings. 

That said, we don't seem to have a way to apply for the reduced flat rate scheme, leaving us with limited options, out of which the regular VAT of 20% seems the most logical, as we could at least potentially claim any VAT we've paid to our suppliers back. Unfortunately, a lot of our venues do not charge VAT as they are charities or churches, and it's a similar case with our teachers.

Sadly, realistically looking, we will sooner rather than later end up spending too much on VAT and be at a financial loss, which, over time, would result in us not being able to provide our services to our community at sustainable/affordable costs. We are interested in exploring any exemptions available to us, or the route of becoming a charity.

If anyone has any suggestions or ideas, we are interested in hearing your thoughts!

Sincerely,

Cambridge Swing Dance