Alliance welcomes government changes to sports club tax relief scheme

The Alliance has played the leading role in persuading HMRC and Ministers to secure a favourable outcome that will benefit community sport.

The Government is making significant changes to the Community Amateur Sports Club (CASC) scheme to allow more sports clubs to take advantage of tax reliefs.

The new CASC rules are vitally good new for sports clubs, and represent a considerable improvement on the original consultation proposals put forward by the Government in the spring.

Tim Lamb, Chief Executive of the Alliance said:

“Tax relief might not be the most interesting of subjects but it will make a significant difference to sports clubs – in some cases a make or break difference – and we're delighted to have secured them. It as an important contribution to the achievement of the Olympic legacy.

“Sports clubs make our society happier, healthier and wealthier – they’re the glue in our local communities and they rely largely on enthusiastic and dedicated volunteers."

Some of the main points covered by the new rules include:

• Clubs will be allowed to charge fees of up to £520 per year – this covers any obligatory costs associated with participation eg membership subscriptions, playing fees, any equipment mandated by the club.
• Clubs can charge more than this – with an absolute limit on membership fees of £1,612 per year – provided they can demonstrate that they make reasonable provisions to enable people on low incomes to participate for £520 or less (eg flexible memberships, offering reduced rates in exceptional circumstances).
• Regarding social income (eg bar takings, non-sporting revenues), there will be no limit on what clubs can earn from their members. As regards non-member income, there will be a limit of £100k per year. Any clubs generating income in excess of this will have to set up a trading subsidiary.
• Corporation tax exemption thresholds for trading and rental income have been increased to £50k and £30k per year respectively.
• Clubs will be able to pay as many players as they like provided the total expenditure doesn’t exceed £10k per year.
• Reasonable travel and subsistence payments will now be allowed.
• Clubs can also pay expenses for overseas tours.
• The informal 50% participating players rule will be formalised so that a club will not qualify for the scheme unless it has at least 50% participating members
• Clubs can use their trading subsidiaries to pay players and pass up the trading profits to the main club using company Gift Aid.
• HMRC has also agreed to look at the issue of incorporation to improve the process for CASCs wishing to incorporate.
• The deregistration charge will remain.

The new regulations are subject to approval by Parliament and should be laid before the House early in the New Year. Prior to this, there will also be a short technical consultation on the precise details of the regulations, and the Alliance and other sports bodies will be invited to contribute to this process.

New guidance for clubs will be published as soon as possible after the regulations are approved by Parliament.

Significantly, existing CASCs will be given 12 months from the passing of the regulations to make any necessary adjustments in order to remain in the scheme.

A deregistration amnesty during this period means that if a club no longer qualifies, it will be able to leave without having to pay the deregistration penalty.

For press inquiries contact Libby Jellie on 07834 726 224.

Find out more about the CASC scheme.

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