Belly Dancing And Bridge
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3 March 2014
There have been
recent cases testing the definition of what constitutes an exempt VAT
under Schedule 9 of the VAT Act 1994 – each case looking at a different
provides an exemption from VAT for those making supplies of education
provided that these subjects are ordinarily taught in school.
This means that there are,
at the moment,
many self-employed teachers claiming a VAT exemption on the strength of
However, in order
achieve the exemption there must be some evidence
that the subject is
taught in at least some UK schools or universities on a regular basis.
belly dancing case failed to achieve exemption – Audrey
Cheruvier Trading as Fleur Estelle Dance School (TC3148). Ms
Cheruvier has a dancing school and six self-employed teach belly
The exemption was
actioned under VATA 1994 Schedule 9 group 6 item 2 “The
supply of private tuition, in a subject ordinarily taught in a
school or university, by an individual teacher acting independently of
employer”. The taxpayer argued that she offered a serious
course of study
in a particular dance form and this was equivalent to dance taught in
HMRC argued that
was no evidence that belly dancing was taught as required by VATA 1994.
taxpayer could not show that belly dancing formed a component of any
taught at either school or university. The FTT concluded that belly
not form part of any course taught at either type of educational
and thus dismissed the application for exemption from VAT.
Bridge is not a
VAT exemption can
be obtained by non-profit making sporting organisations on competition
fees – as detailed on group 10 of Schedule 9 VATA 1994.
A tax tribunal
losing hand to the English Bridge Union, who had wanted to be
recognised as a
sport so that members would not have to pay VAT on their competition
fees, which amounted to £631,000 in 2012-13.
as a sport – a contract sport, as the joke goes – by other countries,
Charity Commission, the sector’s watchdog, and even the International
Committee; the Tax Chamber of the First-tier Tribunal ruled that Bridge
not involve enough physical activity to make it so in the eyes of VAT
(EBU) had argued that Bridge is a healthy pursuit, pointing to studies
that regular contests may benefit the immune system and reduce the risk
dementia. It also insisted that if activities such as croquet, darts
billiards qualify as sports, then the 50,000 members of the union
be seen as sportsmen and women.
to the Oxford English Dictionary backed by the Council for Europe’s
charter which explains that sport “aims at expressing or improving
fitness and mental well-being, forming social relationships or
results in competition at all levels”. This was the definition HMRC had
and it had previously confirmed at a VAT Tribunal in the Royal
Pigeon Racing Association case [VDT 14006].
It was considered
a key objective
of the VAT directive to encourage physical activities in the public
when provided by non-profit making objectives - VAT reference notice
The Tribunal interpreted the European Court of Justice’s (CJEU) ruling
directive was designed NOT to promote wider health, but to make
activities more accessible to a wider section of the population, this
key difference when applying the VAT exemption.
David Ewart, QC, asked whether it was “really possible to draw a
between the mental skill needed in planning a snooker shot, or a
stroke, and the physical skill used in executing it”. Judge Charles
explained: “To our minds, sport normally connotes a game with an
element, rather than simply a game”. In passing judgement, Judge
admitted qualms that failing to recognise Bridge as a sport might
against older people, who form the majority of players.
considered to be
a case that might run and run like Jaffa Cakes, or it might just play
Concern over VAT
exemptions under Schedule 9
These cases show
“grey” interpretation of exempt or “VAT free” supplies.
There are some taxpayers not utilising the
exemption and some claiming it when they should not. Examples here
riding lessons, which can qualify as an exempt supply as evidence that
subject is taught in schools has already been obtained and yet certain
still charge VAT on their services; and other services such as belly
cannot apply the exemption due to lack of evidence as qualifying, and
services are still provided free of VAT.
The key to
VAT exemption for the professional advisor is to obtain evidence of
qualification of the supply, i.e. providing proof that the subject is
ordinarily taught in schools, for example, and thus would survive
scrutiny in a
There is much
advisers to promote real exemptions to the public. The “Bridge” case
a lot of public interest (even more than the Jaffa Cake) and now is the
engage the public and actively advertise the genuine VAT advantages
About the Author
Supplied by Julie Butler F.C.A.
Butler & Co, Bennett House, The
Dean, Alresford, Hampshire, SO24 9BH.
Tel: 01962 735544. Email;
email@example.com, Website; www.butler-co.co.uk
F.C.A. is the author of Tax Planning for Farm and Land
Professional), Equine Tax Planning
ISBN: 0406966540, and Stanley: Taxation
of Farmers and Landowners (LexisNexis).
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Article Published/Sorted/Amended on Scopulus 2014-05-29 09:05:15 in Tax Articles