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Sports Club Owners – Could you be missing out on significant tax savings?
05 May 2022
By James Crumpton, Senior Manager at WR Partners
Are you running a sports club as an Ltd company and paying Corporation tax? You could be missing out on significant tax savings.
Registering as a Community Amateur Sports Club (CASC) could bring significant tax savings and benefits – similar to an organisation with charitable status.
Such benefits can include;
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Exemption on tax from capital gains, bank interest, up to 30k per annum of rental income and up to £50k per annum of trading income
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Relief may be available on business rates
What kind of club can register?
A club seeking to register must meet the following criteria;
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be open to the whole community and be organised on an amateur basis
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its main purpose must be providing facilities for, and promoting participation in, one or more of the eligible sports
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not exceed the income limit
There are a number of conditions associated with the above criteria but I’ll focus on a few one – Amateur basis.
One of the key conditions of a club being organised on an amateur basis is that it is non-profit making. This means that any surplus income or gains are to be invested back in the club and can’t be distributed to members or third parties.
A club operating for both members but also open to non-members may generate trading income over and above the thresholds listed above. Without further action, this will mean that the club no longer qualifies for CASC status and the tax exemptions will be removed.
A separate trading entity, parent company or similar structure may provide owners with the ability to both take advantage of the CASC benefits of operating a sports club whilst maintaining non-member or other trading income. Gift aid payments made by the trading entity to the CASC company may also qualify for Gift Aid relief.
As with all of our services, we can provide as much or as little support as you need and would be happy to discuss your business requirements. Please feel free to contact us at hello@wrpartners.co.uk or give us a call on 08000 664 664.
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