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New VAT Opportunity for Indoor and Outdoor Football League Operators

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The VAT People - Expert Author

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31st October 2013

HMRC have been rejecting claims for VAT declared by indoor and outdoor football league operatorís and upholding assessments for VAT made against those operators who continued to treat the income as VAT exempt. This is despite Goals Soccer Centres success in challenging HMRCís view that VAT was due on income from indoor leagues.

HMRC has maintained an argument that other operators are not affected by the decision as Goalís business operated in a specific way. Therefore other league operators were not on ďall foursĒ with Goals. HMRC used this argument to reject claims for VAT declared by league operatorís and upholding assessments made against those operators who continued to treat the income as VAT exempt.

We are now aware that HMRC may well have substantially changed their stance from stating that they do not agree that other operators are on ďall foursĒ with Goals to giving indoor league operators two options with regards to their VAT position.

1. Accept that the business is making two supplies, one of the exempt land (the pitch hire) and the second being league management services. The VAT declared on league fees would then only be due on the management services element. The obvious point here is that there will be scope for debate with HMRC as to the value of the management services element of the supply and operators will need advice on how to support the valuation used.
2. Continue to argue that a single supply is being made that is exempt from VAT, in which case the matter would need to be decided at tribunal on a business by business basis unless one operator succeeds at higher Tribunal level (as HMRC will reject any VAT claims and uphold any assessments that they may have made).

This apparent change in position by HMRC is to be welcomed as unless an operator has deep pockets proceeding to tribunal may not be as cost effective as accepting option 1. Operators who adopt option 1 will also be partially exempt and will need to consider the impact on their VAT recovery position especially if they own or have built the property that they operate from. In some cases this may result in VAT claimable on costs that has previously been irrecoverable.

We also understand that operators will need to ensure that all their terms and conditions etc are worded in an appropriate manner going forward in order to support the desired VAT treatment.


About the Author

The VAT People are leading VAT and Customs Duty consultants based in the North West of England. We work with a wide range of businesses throughout the UK as well as assisting our accountancy colleagues to unravel the thorny VAT issues for their clients. We are one of the UK's largest and most comprehensive sources of VAT and Customs advice, our consultancy team having over 140 years of experience in VAT and Customs gained in either HMRC or a Big 4 accountancy practice environment.

Call us on our VAT helpline 0800 077 4604 to discuss. All initial discussions are free with no-obligation.



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Article Published/Sorted/Amended on Scopulus 2013-11-12 11:39:12 in Tax Articles

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