Reform could face fines as documents indicate it failed to register for VAT
Reform UK may owe the HMRC thousands of pounds in VAT, interest and late payment charges after it failed to register for the tax at the end of last year.
Political parties must pay VAT on certain income over £90,000 per year, including ticket and merchandise sales, but not on membership fees or donations.
They must register for VAT within 30 days of taxable turnover exceeding £90,000 in a 12-month period.
Sources told The Times that the threshold was exceeded last autumn due to ticket sales from Reform’s conference in September 2024.
However, documents reviewed by The Times showed that Reform did not charge VAT on tickets to its national conference and other events until the end of April.
This followed inquiries from The Times about whether Reform had failed to register for VAT. The party did not respond but subsequently started adding VAT to its sales.
Around 1,800 people attended the conference at the Birmingham NEC in September last year, where the standard ticket price was £50, pushing the party’s income above the £90,000 threshold.
Overall, filings published by Reform in August revealed it made £438,296 from “merchandise sales and events” last year.
In Reform’s financial accounts in 2021, a note suggested Nigel Farage’s party did not understand it had to register for VAT, stating that “as a political party, the party cannot be registered for VAT”.
There is no suggestion that Reform deliberately tried to evade tax.
Dan Neidle, the founder of Tax Policy Associates, said: “This is easy stuff. I would expect a trainee accountant to know this. It’s remarkable that Reform UK got it wrong.”
He said the “rules are stated very clearly” in HMRC guidance and that Reform should have notified the tax authority when the £90,000 threshold was hit, or if it expected it would be within 30 days.
Reform has said it will now review its finances and repay any money that might be owed to HMRC.
Olivia Barber is a reporter at Left Foot Forward
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