HMRC Tax-Relief Changes Place Future of Sports Clubs into Doubt

Anger and confusion has been the reaction following changes to the Community Amateur Sports Club (CASC) scheme that provides charity- type tax relief to sports clubs. HMRC maintains that it is attempting to encourage greater participation in sport among communities but wants to clear clear about the rules surrounding these clubs.

HMRC produced a 44-page document on the changes when consultations started two months ago, after cricket clubs had been targeted over PAYE issues and received expensive fines for unpaid tax for issues with players, bar and ground staff and volunteers.

The new changes cover membership costs, community participation and a proposal that would allow clubs to pay one player up to £5,000 a year and still maintain amateur status as well as scheme membership, expenses, meals and touring travel.

The proposals cover the “definition of a social member and a guest” under the terms of the scheme, along with “the percentage of social members a club should be able to have at any one time and still be considered a sports club”.

Clubs will have to be careful as to how they define different roles within the club to avoid incurring any PAYE fines or additional tax requirement. These changes to the sports club system come at a time when Starbucks, Google, Amazon and other major groups had escaped corporation tax, and have thus been heavily criticised.