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Concluding treatment of non-members' green fees

7th January 2016

The long running saga as to the treatment of green fees paid by non-members to play at non-profit making members’ clubs appears to be reaching a conclusion.

The Court of Justice of the European Union had held that such fees should be treated as exempt, whereas they had previously been treated as standard-rated in UK VAT law. In anticipation of the decision many clubs had submitted reclaims for overpaid VAT.

HMRC had refused to make repayments of this VAT on the basis that unless the clubs agreed to reimburse the individuals who had paid the green fees the clubs would be unjustly enriched.

This position was modified slightly when in Revenue & Customs Brief 19/2015 released in early November, HMRC stated that their view was that most clubs would be unjustly enriched by 50%, though for some clubs charging higher green fees they would be enriched by a higher amount, and on that basis proposed to make refunds of half of the amounts claimed.

The decision of the First-tier Tax Tribunal which was tasked with looking at whether clubs would be unjustly enriched was released on 7 December. This was a test case by the Berkshire Golf Club, The Glen Golf Club, and The Wilmslow Golf Club behind which other cases were stood.

The Tribunal has now decided that the clubs would be unjustly enriched, but only by 10%, meaning they should now receive 90% of the amounts claimed, though the claims may be subject to some amendments as the Tribunal also held that supplies of corporate packages and supplies to tour operators should be treated as standard-rated, not exempt.

Unless HMRC decide to appeal this decision, the matter should have finally been resolved largely in favour of the clubs.

For further advice or assistance please contact our VAT team

Phil Salmon

VAT Partner
Tel: +44 20 7969 5611