Biker club wins VAT case
Many clubs offer members a range of services for their membership fee. For example, membership may include a members’ magazine. Ordinarily, a magazine subscription should be zero rated for VAT purposes, but when the magazine element is bundled into a general club subscription – that is standard rated for VAT – problems can arise.
HMRC is prone to view the “bundled” price as a standard rated supply, whereas the affected organisation would prefer to separate out the zero-rated element thus reducing the cost to their members.
In a recent case, the Harley Owners Group challenged such a fixed supply argument raised by HMRC. They argued that the members’ magazine was a separate supply and should be considered zero-rated, and the courts agreed.
The delivery of mixed services under an umbrella membership subscription is an area of VAT law that is far from clear. However, HMRC has lost a number of cases recently with a similar outcome to the Harley Owners Club.
Latest News
- HMRC issues VAT guidance to help overseas sellers - March 30, 2023
- Crack your Easter childcare costs with tax-free top-ups - March 28, 2023
- Ready for the new tax year? Follow our tips - March 22, 2023
- Chancellor targets business growth in Spring Budget - March 20, 2023
- Budget summary 15 March 2023 - March 16, 2023
- Leaving your business? Why you should plan an exit strategy - March 10, 2023
- Thinking of ditching the 9-5 and going self-employed? - March 8, 2023
- Why close a limited company - March 7, 2023