VAT treatment of affiliation fees for sports clubs

HMRC has issued Revenue and Customs Brief 1 (2018) to remind taxpayers that the concession enabling clubs to treat affiliation fees as exempt from VAT will be withdrawn with effect from 1 April 2018.

A sport’s governing body, or similar umbrella organisation, often charges an affiliation fee to individual clubs which make an onward charge to their members. Where the clubs are non-profit making, the supply of this affiliation fee to their individual members is exempt from VAT. However, if the club is a profit-making commercial club, then the supply to their individual member is standard rated.

The withdrawal of the concession has no impact on the VAT treatment of affiliation fees by non-profit making sports governing bodies, or similar umbrella organisations, nor on non-profit making sports clubs to their members.

Paragraphs 3.6.1 and 3.6.2 of Notice 701/45 are being amended to reflect the changes as well as VAT manual VSPORT2020 – Affiliation Fees.