The Museum and Galleries VAT refund scheme is to be reopened to new applicants for the first time in over three years. This will enable more museums and galleries which open free of charge to obtain VAT refunds on their expenditure.

The scheme was started in 2001 but closed to new applicants in 2018-19. To date, it is estimated to have repaid around £1bn in VAT to eligible museums and galleries.

It allows museums and galleries which open free of charge (whether VAT registered or not) to claim refunds on VAT incurred on goods and services which are purchased to provide free admission. Currently, 159 properties benefit from the scheme in the UK.

In order to apply, a museum or gallery must:

  • Be open to the public free of charge for 30 hours a week and offer free entry without a prior appointment.
  • Hold collections in a purpose-built building.
  • Display details of free entry and opening hours on the museum website.

Libraries are not eligible with the exception of permanent collections in the British Library, the National Library of Scotland and the National Library of Wales which qualify as museum collections.

Newly eligible museums and galleries are required to complete a strategic business case as part of the application process, including:

  • Proof of Arts Council England Accredited status (or equivalent).
  • Past and or projected visitor figures.
  • Information on existing and planned education programs and community engagement work.

Following admission to the scheme, museums must then provide:

  • Evidence confirming an obligation to provide or continue to provide free entry.
  • Visitor figures on a bi-annual basis.

Applications will open in Autumn 2022.

Useful guides on this topic

Museum & Gallery Exhibitions Tax Relief
What is Museum & Gallery Exhibitions Tax Relief? When does it apply?

Registering for VAT
When should a business register for and charge VAT? What are the VAT registration thresholds? What penalties might HMRC issue for late notification of registration? When do you need to file a VAT return?

A beginner's guide to VAT
VAT: Where do I start? What is VAT? Who has to register for VAT? What rate should you charge? How do you calculate VAT? When are your VAT filing obligations?

External link

HMRC Guidance: VAT Refund Scheme for museums and galleries (VAT Notice 998) 

Legislation: s.33A VATA 1994.

Oak ad
Are you enjoying our content? 

Thousands of accountants and advisers and their clients use as their primary TAX resource.

Register with us now to receive our receive our FREE SME Topical Tax Update & newletter.