While the European Union's VAT proposals fail to make exemption for nonprofit organisations, a door has been opened for national VAT compensation schemes such as the one that exists in Denmark.



In a recent tax consultation, the EU approved the submission of the Danish VAT compensation model.  Other member states may consider submitting similar proposals.

There is also opportunity for organisations to qualify for VAT relief through a general exemption scheme that is available for small businesses with a turnover below a certain threshold and through further simplification measures and procedures which nations can introduce.

Member states can also introduce targeted compensation mechanisms, outside the VAT system, to alleviate the cost of VAT on their acquisitions.


In conjunction with ISOBRO`s meetings with the Commission on the green paper concerning VAT,  EFA has had discussions with several experts in the fields of VAT and TAX, as well as many charities. EFA is currently in dialogue with Copenhagen Economics who is researching the possibility of gathering a small group of representatives from fundraising organisations in Europe with a view to making constructive suggestions for change.

A meeting will most likely be set to take place early in the autumn of 2012. Representatives that wish to take part in such a group are invited to contact This email address is being protected from spambots. You need JavaScript enabled to view it. for further information.

Image copyright: Tax Credits