Save VAT on energy costs

Multiple-choice questions. In order to be awarded CPD units you must answer the following five random questions correctly. If you fail the test, please reread the article before attempting the questions again.

Which organisations may have more opportunities to reduce VAT costs?

No organisation has particularly favourable conditions for reduction

Flat-rate VAT-registered organisations

Charities conducting non-business activities

Large multinational corporations

What VAT rate may be applied to the energy bills of a qualifying charity?

10 percent

20 percent

15 percent

5 percent

To which organisation must charities supply a VAT certificate if they are to claim reduced VAT and Climate Change Levy relief on energy?

None of the other answers is correct

The energy supplier

The local authority

HMRC

In what circumstances can charities carrying out both business and non-business activities obtain full VAT relief on energy?

All the other answers are correct

If 60 percent or more of their energy is used for non-business purposes

If their premises have an A-rated energy performance certificate

If they employ more than 50 staff

To which users does the Climate Change Levy apply?

Domestic and non-domestic users of gas, electricity and other commodities

Non-domestic users of electricity only

Non-domestic users of gas only

Non-domestic users of gas, electricity and other commodities

When might a charity be considered to be carrying out a business activity?

When it provides services overseas

When it receives donations

When it employs 10 or more staff

When it charges for goods or services

Which of the following statements is true? Statement 1, zero-rated VAT can apply to purchases of energy-saving materials for buildings used solely for charitable purposes. Statement 2, charities may be able to apply zero-rated VAT to purchases of energy-saving materials that are installed by a business

Statement 1 is correct

Neither statement is correct

Both statements are correct

Statement 2 is correct

Which of the following statements is true? Statement 1, recoverable VAT on road fuel can be calculated by using mileage records. Statement 2, recoverable VAT on road fuel can be calculated by using the fuel-scale charge

Statement 2 is correct

Neither statement is correct

Both statements are correct

Statement 1 is correct

Why might switching from quarterly to monthly VAT returns benefit some businesses?

Refunds are faster

VAT rates are lower

There are no benefits

The payment window is longer

When will zero rating on the installation of energy-saving materials such as solar panels end?

31 March 2027

31 July 2026

31 July 2027

No date has been set

1 unit