St Michael le Belfrey church in York faced with additional £1.4m tax bill

On 22 January 2025 the Department for Culture, Media and & Sport (“DCMS”) announced it will impose a cap of £25k for the maximum amount of VAT a church can reclaim on its building project in a year as part of its Listed Places of Worship VAT refund scheme. 

“The Belfrey” started its £8.5m build phase in August 2024 and has effectively been given just over 2 months to find the £1.4m funding shortfall it faces.

The Belfrey welcomes on average 600 worshippers per week; has established a significant social transformation programme including a CAP debt advice centre, counselling services, a family befriending service and a foodbank; and attracts around 35k visitors per year. It is a designated resource church for the Diocese of York with responsibilities for leadership development and helping to plant and revitalise existing churches across the north.  

As a resource church, our repair and renewal project known as Impact, will help The Belfrey become more resourceful and is the result of many years of prayer, consultation, planning and fundraising.

If the £25k cap is imposed York could be left with a visible building site, a reduced social transformation programme, fewer opportunities to share the Christian faith, a smaller leadership development programme and removal of a key city-centre Visitor attraction. The impact is therefore spiritual, social and economic across the city and the wider region.