VAT payment and reclaim as a Theatre company

[Scott]

Hi folks,

I hope you can help – I’ve searched high and low for advice but all I have found seems centred around “Theatres’ ie the buildings rather than the theatre company (the ones creating the work). We are a touring theatre company – we make the shows as a ltd company and then tour to theatres around the country. In the last year we have grown to the point that our turnover (not including grant income) is close to reaching the VAT threshold. My question is – if we register for VAT – do we have to pay an additional 20% on income that has already had 20% deducted from it by the “Theatre building” that sold the tickets on our behalf?

For eg. we would usually operate on a split deal – the theatre agrees that in return for the show we will receive 80% of the box office income. If the theatre is VAT registered and deducts 20% for VAT off the total income and then pays us our 80% split do we then have to pay a further 20% on that income if we don’t invoice the theatre for our split + vat?

Any advice would be gratefully received!

Thanks in advance
Alex
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