Commentary

V6.189 Liability of supplies and activities of clubs and associations

Part V6 Business by business

V6.189 Liability of supplies and activities of clubs and associations

Clubs and associations

V6.189 Liability of supplies and activities of clubs and associations

Introduction

This section and V6.190 examine the VAT issues affecting clubs and associations of all types, from commercial enterprises and members' sports clubs through to trade unions and professional bodies. Such bodies are often faced with complex VAT issues. This is largely due to the fact that they often receive income which may have any status for VAT purposes: exempt; outside the scope; standard-rated; zero-rated and even reduced-rated.

It is important at the outset to draw a distinction between organisations that are run on a 'commercial' basis and those which are run on a non-profit basis. This is because the VAT issues facing each are markedly different.

On one hand, there are those clubs which are run for commercial purposes. Whilst their administrators may disagree, it is probably true to say that such clubs are more straightforward from a VAT perspective.

On the other hand, there are those which are non-profit making members' clubs or associations. Members' clubs are often be run by enthusiasts for like-minded individuals, perhaps on an informal basis. On similar lines, there are also trade and professional associations which are not run for commercial gain but exist to support a particular cause.

The difference in the VAT issues faced by a commercial club or association from those faced by non-profit-making bodies is accentuated by the exemption for sporting and leisure pursuits (described in full at V4.161) and the exemption for cultural activities (described in full

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