Government Announces New Places of Worship Fund as VAT Relief Ends

In January 2026, the UK Government announced changes to funding arrangements for places of worship that have implications for the care and conservation of historic church buildings across England.

The existing Listed Places of Worship Grant Scheme, which had operated for more than 20 years and allowed churches to reclaim VAT on qualifying repair and maintenance work, will come to an end on 31 March 2026. Under the new arrangements, from 1 April 2026 churches will no longer be able to reclaim VAT on repairs, meaning that repairs and conservation work will in future be subject to the full standard rate of tax.

To support historic places of worship after this change, the Government has announced a £92 million Places of Worship Renewal Fund, running over four years. This new fund will replace the previous scheme and is intended to provide dedicated capital support for repair and conservation work on listed places of worship, bringing them “into line with other heritage assets” in terms of access to funding.

While the new fund represents a significant level of investment, the shift away from automatic VAT relief means that local churches and community groups may face higher costs when undertaking essential maintenance and conservation. Many historic churches rely heavily on local fundraising, volunteers and grant support to care for fabric, roofs, towers and other features. The requirement to meet VAT costs in addition to repair bills could affect the scope and timing of future projects.

For organisations like the Romney Marsh Historic Churches Trust, which supports the maintenance and conservation of 14 medieval churches across the Marsh, the change underlines the ongoing importance of membership support, donations, legacy gifts and wider community engagement in sustaining these historic buildings. Effective conservation depends on a combination of external funding, volunteer effort and local stewardship to ensure that repair work - whether large-scale stonework projects or smaller fabric restoration - can go ahead without undue delay.

As details of how the new fund will operate are finalised, church bodies and heritage organisations continue to monitor developments to understand how best to access support for essential work while managing the additional costs associated with the ending of VAT relief.

Please support us, as our grants to maintain the historic churches of Romney Marsh may be more critical than ever in the years ahead.