Water Rates – are you exempt?
The Scottish Government introduced a new exemption scheme for charities in April 2015, to help with the cost of their water and waste water bills.
These exemptions were based on a range of criteria, such as the charity’s income level and associated commercial activity. You can read more about the details at the end of this post.
The Scottish Government is now in the process of reviewing the water rates exemption scheme. MGS is encouraging the sector to respond to a short survey to feedback with your experience.
We know of museums who have lost out on exemption due to very limited commercial activity. This has included the sale of books relating to the venue or even just selling postcards. At the same time, we know other venues with well-established commercial operations have successfully applied for exemptions.
The Scottish Council for Voluntary Organisations (SCVO) has reported inconsistencies beyond the museum sector. They are seeking input on the subject to find out how the scheme is working for all charities in Scotland.
How to take part
The survey is open until Friday 29th September.
The small print
The current water rates exemption scheme is based on a range of criteria and qualifying conditions. Charities with an income of less than £200,000 are not required to pay water and sewerage charges. Those with incomes between £200,000 and £300,000 pay a reduced rate. The exceptions which were set out, however, stated that charities are not eligible for support where one or more of the following conditions are met:
- the charity holds a permanent alcohol licence to sell alcohol at the premises;
- the premises are a charity shop or other premises used for the purposes of retailing new or second-hand merchandise;
- the premises operates as a café which is open to the public and operated on a regular basis to generate income – i.e. not for the purpose of occasional coffee mornings or bake sales and excluding canteens provided by the charity to support its own volunteers.
- the organisation is a Local Authority or an Arms-Length External Organisation which organisations that can be used by councils to deliver services.
Crucially, even if a venue qualifies for an exemption, they are required to have actively applied for that exemption – otherwise charges would be applied.
While there have been means of adjusting arrangements to ensure an exemption still applied, they haven’t been practical in our sector. For example, while commercial operations could be moved off-site, with enterprises like museum cafes – which are an important way of attracting people to visit collections – such arrangements are impractical at best.