> You are NOT a non-profit if you sell stuff.

That's not true in the for example the UK, where there are a couple of corporate structures that allow you to trade as a non-profit.

And there are rules about registering for VAT: https://www.gov.uk/vat-charities/registration

https://www.gov.uk/vat-registration/calculate-turnover

VAT is complex, and it seems the advice they got wasn't robust.