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The Government’s Community Amateur Sports Club (CASC) scheme allows you to save money through a range of tax breaks. Designed to support and financially benefit grassroots sports clubs, many tennis clubs have already signed up to take advantage of the key benefits on offer.
More than 6,000 Community Amateur Sports Clubs have been registered with HMRC, together receiving in excess of £115m in tax relief since the scheme’s inception. This is a substantial figure and highlights how valuable the scheme is to grass roots sport, including the nearly 600 tennis clubs who have signed up.
The CASC scheme – and the conditions associated with it - is currently under review by HMRC – and we are actively involved in trying to shape the outcome of that consultation process. HMRC is considering responses to a consultation, which closed in August 2013. We will update this page when the outcome of the consultation is known.
The consultation related to the conditions that are inevitably imposed by HMRC for clubs to qualify for the benefits of CASC status, and these could affect your club, its ability to join or remain a CASC. The LTA and other governing bodies have therefore been working behind the scenes with the Sport and Recreation Alliance and others on this issue, after a number of issues had led to concerns about the future of the scheme. The consultation covered a range of areas, and asked important questions around whether there should be a limit on membership fees; whether additional definition around membership should be introduced; whether CASCs should be allowed to pay players, or subsidise their travel costs; and whether there should be a limit on the proportion of income from social, or non-member, activities. The LTA was concerned that the unintended consequences of the proposed changes could make it difficult for some existing CASCs to comply or undermine their sustainability. The LTA received input from a variety of clubs to help shape its response to this important Government consultation, both from existing CASCs and tennis venues yet to sign up. View a summary of the response.
As you’d expect, clubs applying have to meet certain conditions to access these benefits. Their club constitutions and/or other governing documents have to show that they are community-focused and open to all without discrimination; have a core purpose to promote a recognised amateur sport; reinvest any income back into the club, and be managed by fit and proper persons. The consultation essentially asked whether these conditions need updating.
The LTA welcomed some improvements to the scheme, including through the increase to the current threshold limits, as this will reduce tax burdens. However, we outlined concerns about some unintended consequences of proposals in other areas, primary relating to the suggested income tests and further definition around membership. Where sport is a club’s genuine, core purpose, and income from their activities is reinvested in community sport, the LTA believes that flexibility around how income can be generated supports sustainability. Restrictions around income generation, for example from non-members, may also have a negative impact on the drive to increase participation. The LTA also highlighted the concerns raised by registered places to play around the proposal to introduce additional definitions around what constitutes a ‘participating’ member, as well as responding to the other questions posed in the HMRC Consultation. It also recommended introducing improved procedures for deregistration and incorporation.
Read the Key Points of the LTA’s Consultation Response.
The LTA supports clubs and places to play to achieve CASC status, but some new applications will not be processed until the outcome of the current review is decided. There are some benefits in applying now – as the benefits can be backdated to the date of registration. However, clubs may want to weigh this up against the current uncertainty to decide if it’s better to know the outcome of the consultation before applying.
CASC status cannot be transferred and therefore the new incorporated entity would have to apply for CASC status. However, it is not possible to do this until there has been a transfer of assets from the old unincorporated entity to the new incorporated entity. For certainty, clubs may wish to wait for the new rules to be put in place before beginning this process. There is a danger that clubs can lose their CASC registration as they have incorporated and the new company has not been registered as a CASC by HMRC. If clubs wish to proceed, it is strongly advised that to reduce this risk, the club should first contact HMRC to ascertain whether the new incorporated entity is likely to be registered as a CASC. It is very important that all the relevant facts are disclosed to HMRC including the club’s income from social and non-sporting activities. The club should not transfer its assets from the unincorporated entity to the new incorporated entity until this confirmation has been received.
We will be updating these pages as more information about the consultation outcome becomes available, but in the meantime if you have any questions contact the British Tennis Services team – info@LTA.org.uk or 020 8487 7000.
Membership fee cap: A new proposed threshold of £1040 on membership costs, with flexibility above this in certain circumstances. There was no cap previously, and the majority of tennis clubs who inputted saw no need for one. However, the LTA believes the level proposed will cause minimal issues for tennis.
Social members and guests: proposes definitions around frequency of play which the LTA and member clubs are concerned about. There should be a broad definition of a participating member, and we do not believe that members who only play occasionally, or a few times a year, should be defined as social members.
Level of social (ie non-sporting) income: the Government proposes some income tests which will effectively limit the amount of social income (e.g. bar and restaurant income, venue hire etc) or non-member income (i.e. pay & play, non-member coaching courses, non-member food & drink) that can be generated by a CASC club, before they are required to operate a trading subsidiary. There are concerns about this.
More flexible rules for travel expenses: The additional flexibility proposed should help clubs, for example enabling a coach or official to claim expenses to a match or tournament
Payment of players: The consultation proposes clubs being able to pay one player up to £5000 pa. The LTA’s priority is to ensure subsidies towards talented juniors are NOT seen as player payment. The LTA is minded to view (adult) player payment as non-amateur, and many tennis clubs who responded were against player payments. However, we may undertake more work prior to forming a firm policy position.
The Government has announced a consultation on changes to the future of the Community Amateur Sports Club (CASC) scheme, which provides a number of financial benefits through tax breaks for those signed up.
Obtaining tax relief on junior subscriptions – a guidance note has been developed to support CASCs obtain tax relief on junior subscriptions.
Read about the differences between CASC status and Charitable status.
VAT & Facility Improvement - guidance note
To find out more about the CASC scheme, hear about clubs who have saved money, and to apply, please visit the CASC website