VAT Concession on Affiliation Fees Removed For Proprietary Clubs .
Saturday 3rd February 2018
HMRC Decision to take effect from 1st April 2018
A concession which has allowed proprietary golf clubs to treat affiliation fees as VAT-exempt is being withdrawn by HMRC. Membership subscriptions at proprietary clubs have always been subject to VAT, but HMRC has previously allowed affiliation fees to be treated as a disbursement and, therefore, exempt.
Please click here to read HMRC’s guidance on this change, which was issued on 17th January 2018..
This decision has been made despite lobbying by England Golf and comes into effect on 1 April 2018. From that date proprietary clubs who re-charge affiliation fees to their members as a disbursement will have to charge VAT at the standard rate of 20% on their members’ affiliation fees to England Golf and to their County Union or Association. This means that for 2018 the England Golf affiliation fee of £8.25 will need to be charged with 20% VAT of £1.65, making a total of £9.90. The County affiliation fee will also need to have VAT added and will need to be declared as output VAT on the club’s VAT return. The withdrawal of the concession only affects proprietary clubs and non-profit making members’ golf clubs should continue to treat affiliation fees as VAT exempt, together with membership subscriptions. England Golf is continuing to ask all clubs to continue to show affiliation fees separately to the main subscription when billing their members. This tells the member exactly what they pay to the different organisations and highlights to them that they are a member of England Golf and their County Union or Association, as well as their club.
The CGU Executive discussed this development at its meeting last week and expressed disquiet at the disparity which will now exist between the affiliation fees charged by clubs. At the same time the Executive wished to make it clear there is no additional benefit to either the Union or England Golf from the change with VAT being charged at source and added to the club's VAT return.