Churches face fresh funding challenge as key VAT support scheme hangs in the balance.

 

Churches across the UK are at risk as uncertainty grows over the future of the Listed Places of Worship Grant Scheme—a lifeline that helps churches reclaim VAT on repair and maintenance work.

In January 2025, the Government extended the scheme for just one more year, but with a smaller budget and a new cap. The scheme will now run until March 2026, with a reduced budget of £23 million (down from £29 million) and a new £25,000 claims limit, which will hit larger projects hardest.

Since its launch in 2004, the scheme has helped over 13,000 places of worship cover the costs of essential maintenance. Without it, churches face a 20% rise in project costs—money many simply don’t have.

What we love about churches is that they are not just historic landmarks. They are hubs for their communities—offering foodbanks, mental health support, youth clubs, debt counseling centres and spaces of warmth and welcome for everyone, regardless of faith.

According to the National Churches Trust House of Good Report, churches provide a staggering £55 billion in social value each year.

With many churches already stretched thin, the loss of this support could mean projects stall, services are cut, and some churches may even close.

 

St John’s Chatham: A church at risk

 

One such project is St John’s Church in Chatham, Kent. Built in 1821, it reopened in 2021 after decades of closure. It now welcomes over 200 people each week and is undergoing a major regeneration—restoring the building and creating a new concert venue and workspaces for small businesses that will serve the whole community.

But the new cap on claims has left the project £100,000 short, putting vital parts of the development at risk. With other funding sources stretched, the future of the project—and the community hub it promises to become—is uncertain.

And St John’s isn’t alone. Many projects across the UK are now in jeopardy.

 

How you can help

 

Cinnamon Network and other Christian funders are calling on the Government to not only continue the scheme beyond 2026 but to reverse the budget cut and claims cap.

Over 3,000 people have already written to MPs to show their support and you can add your voice.

We’ve created a template letter you can adapt and send to your local MP or use as a statement from your organisation.

 

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Template letter to your MP

We’ve created a template letter you can adapt and send to your local MP or use as a statement from your organisation.

 

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To: [Insert MP Name and Contact Details]
From: [Insert Your Name / Organisation Name]

Dear [MP Name],

I am writing on behalf of [Your Name / Organisation] to raise serious concerns about the future of the Listed Places of Worship Grant Scheme.

While we welcome the Government’s decision to extend the scheme for another year, the introduction of a £25,000 cap and the lack of commitment beyond March 2026 is deeply worrying. This scheme plays a vital role in helping places of worship meet the rising costs of maintaining historic buildings. Without it, many churches will struggle to survive.

[Add a personal connection or experience with the scheme here]

One example already feeling the impact is St John’s Church in Chatham, Kent—a historic church built in 1821, closed in 1997, and reopened in 2021 thanks to major community investment. It’s now at the heart of a major regeneration project, supported by the National Lottery Heritage Fund and others. The new claims cap will leave the project £100,000 short, forcing cuts to essential elements like access improvements and community spaces. And it’s just one of many across the UK facing similar challenges.

Churches like St John’s are not just buildings—they are community anchors. They offer services for people of all faiths and none, providing real value in local areas. It’s already difficult for churches to generate the income they need to meet demand. This grant scheme is not a luxury—it’s essential.

I urge you to support the continuation of this scheme beyond 2026 and call for the removal of the £25,000 cap. The future of many communities depends on it.

Yours sincerely,
[Your Name and Title]
[Signature, if sending a printed letter]

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Further resources

If you want to learn more or share additional information with others:

• National Churches Trust – Grant info and support

• Historic England – Advice on preserving historic churches

• ChurchCare – Guidance on church maintenance and grants

• The Heritage Alliance – Campaigning for heritage sites

• Listed Places of Worship Grant Scheme – Full details on the VAT recovery scheme