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Withdrawal of ESC on sports club affiliation fees

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The extra-statutory concession enabling profit-making sports clubs to treat affiliation fees charged by a governing body and passed on to their members as exempt from VAT (VAT Notice 701/45 para 3.6.2) will be withdrawn with effect from 1 April 2018. HMRC has confirmed the withdrawal in Revenue and Customs Brief 1/2018 (see This follows consultation between January and March 2017.

The purpose of the concession was to put profit-making commercial clubs in a similar position to non-profit making clubs, which do not need to account for VAT on the onward charge to their members. The concession allowed profit-making clubs to treat these re-charges as disbursements. However, as such re-charges are not legally disbursements, the concession goes beyond HMRC’s discretion and can no longer stand.

Issue: 1384
Categories: News , Indirect taxes , VAT