VAT on Craft Fairs: What Stallholders Need to Know
Understanding VAT on Craft Fair Stalls
Participating in a craft fair is a great opportunity for small businesses, but many stallholders may not realise the VAT implications. When a seller rents a stall at a craft fair, they are paying for more than just a physical pitch. The fair’s organisers often provide additional benefits, such as marketing, event management, and infrastructure, making the service more than just a rental of land.
A recent Upper Tribunal decision in the case of CRC v Kati Zombory-Moldovan (trading as Craft Carnival) confirmed that stall rental at a craft fair is a taxable supply. This means that stallholders may be required to pay VAT on craft fair stalls if the event organiser is VAT-registered.
Why Stallholder Fees Are Taxable
VAT law generally treats the rental of land as an exempt supply. However, when the craft fair organiser provides more than just the right to occupy a space, it becomes a taxable supply for VAT purposes. The tribunal ruled that participation in a high-quality, well-organised craft fair includes services beyond land rental, such as:
- Marketing and promotion of the event
- Access to fair infrastructure, security, and management
- Providing a customer-attracting environment
Because these elements add value beyond simply renting a pitch, VAT must be charged.
Implications for Stallholders
Stallholders participating in craft fairs should check whether their stall fees include VAT. If they are VAT-registered, they may be able to reclaim VAT on the fees they pay. However, unregistered stallholders may find these additional costs impact their profit margins.
If you run a craft business, it is important to consider VAT when pricing your products. Some stallholders may need to register for VAT if their taxable turnover exceeds the £90,000 threshold (as of 2024).
How We Can Help
Understanding VAT on craft fair stalls can be complex, especially for small businesses and sole traders. At Lewis Brownlee, we offer professional VAT advice to ensure compliance and help stallholders manage their tax obligations.
We also offer a free introductory meeting where you can discuss your VAT concerns with our experts. This no-obligation session allows you to explore your tax position and gain tailored advice.
For personalised VAT guidance, help is at hand. Contact us today to book your free consultation.