Energy guide for charities and non-profit organisations
Make It Cheaper's VAT exemption
0800 140 4692
Suppliers' VAT exemption forms
Most charities - whether they're registered or not - qualify for
a reduced 5% Value Added Tax (VAT) rate and exemption from Climate
Change Levy* (CCL) on their energy bills.
This usually knocks about a fifth off the total cost but the
onus is on you to tell your energy supplier about your eligibility,
otherwise you may be missing out. If you have been overypaying, the
good news is that you can also claim a rebate for the past four
years - either from your supplier or from HMRC.
Make It Cheaper research shows that 46% of charities didn't know
about the reduced VAT rate and CCL exemption - and 69% were unaware
of the rebates.
The largest rebate received by a Make It Cheaper customer to
date (June 2014) is £115,000, which was received
by a school that had been incorrectly charged for VAT and CCL on
its gas consumption for three years.
Common scenarios for incorrect VAT
- Switching energy supplier or renewing your contract.
- Changing the name of your organisation.
- Changing legal entity - for example, schools leaving Local
Authority control to become academies or free schools.
Who qualifies for reduced VAT and CCL exemption?
- Care homes.
- Free schools and academies.
- Student accommodation and boarding houses.
- Self-catering holiday accommodation - including caravans.
- Businesses using less than 1,000 kWh/month of electricity or
4,397 kWh/month of gas.
How can charities apply for a VAT
reduction or rebate?
If you think you're entitled to a bill reduction or rebate,
you'll need a VAT Declaration Form to start your application. You
can download the appropriate form for your energy supplier below
and send it to the address shown.
- British Gas
British Gas Business, Spinneyside, Penman Way, Grove Park
Leicester, LE19 1SZ
CNG, CNG House, 5 Victoria Avenue, Harrogate, HG1 1EQ
- Corona Energy
Corona Energy Ltd, Edward Hyde Building, 38 Clarendon Road
Watford, WD17 1JW
- EDF Energy
EDF Energy plc, Registration Department, Southdownview Road,
Worthing, BN14 8NL
E.ON, PO Box 9042, Sherwood Park, Annesley, Nottingham, NG15
- Gazprom Energy
Gazprom Energy, Bauhaus, 27 Quay Street, Manchester, M3 3GY
- Haven Power
Haven Power Limited, The Havens, Ransomes Europark, Ipswich, IP3
npower Direct Limited, 2 Princes Way, Solihull West Midlands, B91
- Opus Energy
Opus Customer Services, Royal Pavillion, 2 Summerhouse Rd,
Northampton NN3 6BJ
- Scottish Power
ScottishPower Energy Retail Limited, SME Contact Centre, PO Box
7111, Cathcart, Glasgow G44 4GP
Scottish & Southern Energy, Grampian House, 200 Dunkeld Rd,
Perth, PH1 3GH
If you would like any advice or help with your application, our
energy experts are available - free of charge - over the phone. We
can also look at the unit rates you are being charged on your bill
and tell you if we think there's a better tariff for you. If it's
not the right time to switch, we can log your contract end date so
that we can get in touch when your supplier is due to increase your
prices again. Call 0800 140 4692, Monday to
Friday, 9am to 5.30pm.
* By successfully applying for a VAT
reduction, you automatically become exempt from the Climate Change
Levy: currently 0.541p per kWh for electricity and 0.188p per kWh
** Under the Finance Acts 1993 &
1997, charities (registered and unregistered) whose energy is used
"otherwise than in the course or furtherance of a business" for at
least 60% of its actual use, can receive all their power supplies
at the reduced rate of 5% VAT. If your 'non-business' use is below
60% of total usage, that proportion of the supply can still be
applied to the reduced rate. For example, if 35% of energy use is
non-business, 35% can be taxed at 5% and 65% at the standard VAT