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Partial victory for members’ clubs in HMRC VAT dispute

HMRC has agreed interim payments to private members’ golf clubs, which have been in dispute with the Revenue for several years over the need to charge VAT. While private members’ clubs do not have to charge VAT on annual subscriptions, there has been an ongoing legal wrangle over the need to charge VAT on visitor green fees.

A statement based on information from accountants KPMG, acting for several of the golf clubs involved said:
“HMRC will apply a provisional unjust enrichment restriction to the claims and make an interim payment plus simple interest. For the majority of clubs, this restriction will be 50 percent of the value of the final claim. For a small number of clubs there will be a restriction of 67 percent of the final claim. Whether a club will receive 50 percent or 67 percent depends on a number of factors but the higher restriction is likely to be associated with the highest green fees and thereby highest claim value. HMRC will have 30 days to make the interim payment once the final claim amount is agreed.”

According to information provided by the Golf Course Managers Association, HMRC will issue instructions by 10 February and subject to verification of their claims, clubs should receive an interim payment by April. Meanwhile lawyers for both sides will be arguing the remaining value of claims, and if no agreement is reached a further High Court hearing will be scheduled in the summer.