Increase to charities’ small trading exemption limits

From 6 April 2019, HMRC increased the small trading tax exemption limits for 2019/20. The exemption allows charities, who have trading income not relating to their primary purpose, to still be exempt from paying tax, providing they meet the annual income criteria.

The previous limits were:

The new limits from 6 April 2019 are:

These changes should have a positive impact on charities who have trades outwith their primary purposes to raise funds, helping towards their primary purpose. However, charities should still ensure that their governing document does not restrict non-charitable trading.

Don’t know if your charity has trading income?

The Scottish charities regulator, OSCR, has published a Charities and Trading Guide which provides helpful and ways a charity can trade and what Trustees need to consider.

For further advice on whether your charitable business qualifies for small trading tax exceptions, please contact a member of our EQ Charities team via charities@eqaccountants.co.uk or contact one of our offices.