Charities, banks and other groups who hire temporary workers are facing a hike in VAT payments, following the withdrawal of a concession in the Budget.

Agencies are campaigning against the change, which prevents organisations recovering costs tied to the recruitment of temps.

The Budget decision means that only VAT-rated businesses will qualify for relief from April next year.

That means much of the not-for-profit sector, as well as financial services groups, will lose the benefit, worth £125m a year to business, The Telegraph reported.

Further Reading:

Budget bombshell