V2.211 Deemed business—club, association or organisation
This paragraph examines the deemed business of clubs, associations and organisations by virtue of VATA 1994, s 94(2)(a).
For an overview of VAT and business more broadly, see V2.201B.
Whether or not a club, association or organisation carries on a business is determined in accordance with the principles described in V2.203–V2.203A. It is irrelevant whether or not any public benefit arises from achieving the body's purpose according to Royal Ulster Constabulary Athletic Association Ltd 1. However, VATA 1994, s 94(2)(a) provides that, without prejudice to the generality of other provisions, 'the provision by a club, association or organisation (for a subscription or other consideration) of the facilities or advantages available to its members' is deemed to be the carrying on of a business.
It was held in Eastbourne Town Radio Cars Association2that the purpose of the provision is twofold:
• to ensure that the activities of an association are not excluded from the scope of VAT merely because the association is unincorporated and not a legal person (see also Royal Troon Golf Club3)
• to enable a taxable supply by a taxable person to be brought within the scope of VAT if it might otherwise be thought to be non-business
The provision implies that three conditions must be met:
• there must be a 'club, association or organisation' (hereafter referred to merely as a 'club')
• facilities or advantages must be provided
• a subscription or other consideration must be given
These conditions are discussed