The supply of advertising to a charity is zero-rated. The zero-rating covers advertisements on any subject, including staff recruitment. A charity can also purchase pre-printed collecting boxes, envelopes and appeal letters at the zero rate. Low cost lapel stickers, emblems and badges that a charity gives in acknowledgement of a donation can also be zero-rated. More information can be found in Notice 701/58 Charity advertising and goods connected with collecting donations.
Any medium which communicates with the public. This includes all the conventional advertising media such as television, cinema, billboards, the sides of vehicles, newspapers and printed publications. The important factor is whether the advertisement is placed on someone else’s time or space. If it is not there will be no scope for zero-rating.
If space is sold to a charity for advertising on other items, such as beer mats, calendars, or the reverse of till rolls, this will also be covered by the zero rate. The sale of the items themselves will not be VAT free, unless they qualify for other reliefs for example as books or children’s clothing.
Recently I was asked if a website would be able to zero rated, but its specifically excluded under UK Law VCHAR11000
10B None of items 8 to 8C includes a supply used to create, or contribute to, a website that is the charity’s own.For this purpose a website is a charity’s own even though hosted by another person. 10C Neither of items 8 to 8C includes a supply to a charity that is used directly by the charity to design or produce an advertisement.
The cost of a web site is analogous to that of a shop window. The cost of constructing the window is capital; the cost of changing the display from time to time is revenue. (BIM35870)
UITF Abstract 29
Set out 4 key areas of cost:
Planning – P&L
Application and infrastructure development – Tangible Fixed Asset
Design costs – P&L
Content costs – P&L
HMRC also have some useful information on software in CA23410
Computer software qualifies for PMAs if it is not already plant.
Computer software is not defined in the capital allowance legislation. You should treat computer programs of any type and data of any kind as computer software. Computer programs range from operating systems like Windows to games like Solitaire. There may be no physical asset because software is sometimes transferred by electronic means, for example it may be downloaded over the Internet. Software acquired that way is also plant.
A person may acquire a right to use or otherwise deal with computer software. If so, the right and the software to which it relates are plant. Treat the person as owning the plant while the person is entitled to the right.
Capital Allowances and the Annual Investment Allowance can be claimed against Plant including software.
Online sales in the run up to Christmas this year are expected to grow by 19.5% over 2013, with UK shoppers expected to spend £17.4 billion online.
Total Christmas sales are predicted to reach £74.3bn according to research conducted by the Centre of Retail Research for RetailMeNot, with the average UK household spending £775 on all of their Christmas shopping.
Are you trading online? do you have a website? do you have an App?
A OnePoll survey commissioned by AppsBuilder reveals that £52.6 billion of potential revenue to be gained via mobile is being ignored by over 3.2 million UK SMEs. It found that 65.8% of the nation’s 4.9 million SMEs don’t currently have a mobile presence, equating to potential lost revenues of £52.6 billion in the next 12 months alone. The number of consumers in the UK using mobile phones to access the internet has doubled over the past three years and about 5% of all UK retail sales come via mobile phones. (Law Donut)
Its not just about Apps, websites too need to be optimised…
With only 10% of the UK’s small and medium-sized enterprises (SMEs) having a mobile optimized website, businesses could be missing out on £77 billion in annual revenue a study has found. And only 13% of those without a mobile optimized site plan to have one by the end of 2014.
The survey, conducted by Impact Research for hibu, asked 900 UK SME owners and IT leaders about their companies’ websites, revenues and future plans for the mobile web. It showed that 45% of UK SMEs do not have a website, yet believe their annual revenue could rise by 5.4% if they had a website that was optimised for mobile transactions, equating to an average of £11,155 extra turnover annually.
HMRC had a number of copycats trying to offer self assessment returns, here is an extract from the Tax Agents Blog in January…
With the 31 January deadline for filing SA returns fast approaching, the media has been asking us for our view on ‘copycat websites’, where companies offer to file returns for customers in return for large fees – sometimes up to £400. These companies pay to advertise their link at the top of search engines, so customers find them first when searching for ‘HMRC’, ‘tax return’ and so on.
I thought I’d let you know that our view on this hasn’t changed. It costs nothing to file a tax return. It’s important that anyone thinking of using a tax return agent is clear in advance about fees payable – and can satisfy themselves that they will receive the service they are signing up for.
Misleading websites that try and palm themselves off as legitimate government services are to come under the spotlight from Trading Standards (4 March 2014) as Consumer Minister Jenny Willott confirmed extra funding for them to help tackle these rogue traders.
The Minister has committed an additional £120,000 this financial year to National Trading Standards Board (NTSB) so they can investigate these websites. This money will help NTSB also tackle websites that exaggerate the nature of the services they provide or deliberately underplay that people can get them for free or at a lower cost from official sources.
There was also a 19.2% growth in internet purchases from a year earlier, the fastest increase in four years……..
The online retail boom was very much in evidence in late 2013, with many High Street chains expanding their internet offerings, and some shops reporting record figures for the amount customers purchased online around Christmas.
In a recent AccountingWEB survey on average survey respondents said more than 80% of their customers use a smartphones or a tablet and almost all expect this number to increase over the next 12 months.
Without an online presence your business is likely to be become invisible to your customers.
Its not just about having a website either, there needs to be something that will keep your customers visiting your website and you probably need an app….
The government wants to make the UK the best place to start and grow a business. In the autumn it will launch a public campaign to celebrate GREAT British business success stories. The government wants to inspire other small businesses and point them towards the support that can help them grow. It will also launch a new strategy for how the whole of government will back them. This will set out a range of measures to continue helping budding entrepreneurs and existing businesses succeed.
If you are a business interested in the ‘Grow Online, Expand Worldwide’ campaign, please call 02070344848 and speak to a member of the Click:Connect:Sell team.
Just 33% of small to medium-sized companies have a digital presence and only 14% sell their products online. But research suggests that if UK SMEs fully adopted online technologies, they could increase annual turnover by £18.8 billion. Here in the UK we’re twice as likely as the OECD average to buy goods online.