What is VAT?

VAT stands for Value Added Tax. It is a consumption tax added to most goods and services. You pay it when you buy things, and businesses collect it on behalf of the government. It's often something that affects all of us every day, but we don't think about it. 

The standard rate of VAT in the UK is 20%, and VAT is managed by HM Revenue and Customs (HMRC).

Why does VAT now affect my society?

Businesses and organisations in the UK have to register for VAT if their taxable turnover is more than £90,000 annually. 

Societies are becoming part of the Guild's legal and VAT identity from 1st August 2026. This means that all trading income generated by societies and the Guild is added together. This total income exceeds the £90,000 threshold for VAT registration.

Over the last few years, societies have grown significantly in size and complexity. At the same time, the expectations placed on universities and students’ unions around student safety, freedom of speech, event management, harassment and misconduct prevention, and regulatory compliance have increased considerably. As a result, the Guild has had to take a more active role in supporting, overseeing and managing society activities.  

As the Guild assumes greater responsibility for supporting societies, managing risks, and protecting them from financial or legislative dangers, it is no longer deemed safe for societies to function as financially independent entities as they have done previously.

One of the key aims of these changes is to reduce risk for students. Previously, certain responsibilities and liabilities could potentially fall on student volunteers and society committee members. By bringing these activities within the Guild's framework, those risks are now managed through the Guild's governance, financial controls and support systems. 

How was this decision made?

This decision was made by the Guild's Trustee Board in Spring 2026. 

As the Guild is a registered charity, it is governed by a Trustee Board. The Trustees are delegated authority by the Guild's CEO to make decisions regarding the organisation's strategy. The board is made up of our elected full-time student officers, student trustees and external trustees, many of whom have personal experience of being committee members for a society. The board took the time to consider the different options available to the Guild and considered how best to support societies in the long term, with the best outcomes for student leaders in mind. 

The board agreed that societies should no longer operate as financially independent groups in the same way that they have previously. This decision, the board decided, reflects the reality that the Guild now provides significantly greater oversight, support, governance, training, financial monitoring and risk management than it has in the past. The decision was made with the intention of protecting Society Leaders. 

If you would like to know more about the Guild's Trustee board, including the board's meeting minutes, you can do so here. 

What will be happening next? 

Over the coming months, the Guild will: 

• Update constitutions, policies and guidance. 
• Provide detailed VAT guidance and practical examples. 
• Offer training and drop-in sessions for society leaders. 
• Introduce new systems and reporting tools to support societies. 
• Continue working closely with student leaders throughout the transition 

Our aim remains simple: to make it easier for societies to focus on creating great experiences, building communities and supporting fellow students, while the Guild takes on more of the responsibility for governance, compliance, finance and risk management.