Eynsham Cricket Club v The Commissioners for Her Majesty's Revenue & Customs, TC 06047
| Jurisdiction | UK Non-devolved |
| Judge | Jonathan RICHARDS |
| Judgment Date | 03 August 2017 |
| Neutral Citation | [2017] UKFTT 0611 (TC) |
| Respondent | The Commissioners for Her Majesty's Revenue & Customs |
| Appellant | Eynsham Cricket Club |
| Reference | TC 06047 |
| Court | First-tier Tribunal (Tax Chamber) |
[2017] UKFTT 0611 (TC)
TC06047
Appeal number: TC/2015/03802
VAT – revised decision following review - whether construction of cricket
pavilion zero-rated – whether club a “charity”- no – whether intended use of
pavilion in course or furtherance of a business – yes – whether intended use
as a village hall or similarly in providing social or recreational facilities for
a local community – yes - whether EU law principles of equal treatment or
fiscal neutrality apply – no – appeal dismissed
FIRST-TIER TRIBUNAL
TAX CHAMBER
EYNSHAM CRICKET CLUB Appellant
- and -
THE COMMISSIONERS FOR HER MAJESTY’S Respondents
REVENUE & CUSTOMS
TRIBUNAL:
JUDGE JONATHAN RICHARDS
SUSAN LOUSADA
Sitting in public at The Royal Courts of Justice, Strand, London on 14-17 June
2017 and having considered written representations from the parties in the
course of the Tribunal’s review under Rule 41 of the Tribunal Rules
John Brinsmead-Stockham instructed by Hogan Lovells for the Appellant (both
acting pro bono)
Jonathan Davey QC, instructed by the General Counsel and Solicitor to HM
Revenue and Customs, for the Respondents
© CROWN COPYRIGHT 2017
2
DECISION
1. The appellant cricket club (the “Club”) is an unincorporated association and has at
all material times been registered as a community amateur sports club (“CASC”) for 5 the purposes of the Corporation Tax Act 2010. The Club is appealing against a
decision of HMRC dated 21 May 2015 that services supplied to the Club in
connection with the construction of a new pavilion between June 2014 and February
2015 were standard-rated for VAT purposes. The Club considers that they were zero-
rated by virtue of Schedule 8, Group 5, Item 2 of the Value Added Tax Act 1994 10 (“VATA 1994”).
2. Unusually, therefore, this appeal is brought by the recipient of a supply, rather
than the supplier. Mr Davey did not suggest that the Club had no standing to bring the
appeal and the wording of s83(1)(b) of VATA 1994 and the decision of the Court of
Appeal in Customs & Excise Commissioners v Cresta Hotels [2001] STC 306 15 indicates that it does have standing. We will therefore deal with the appeal.
3. The parties were agreed that three issues (at least) need to be determined in order
to decide this appeal. The first relevant issue (“Issue 1”) is whether the Club was a
“charity” for the purposes of Schedule 8, Group 5, Note 6 of VATA 1994 (which in
turn refers to a definition set out in Schedule 6 of Finance Act 2010 (“Schedule 6” and 20 “FA 2010” respectively). Since they were agreed that the Club satisfied some aspects
of that definition, Issue 1 was broken down into the following three sub-issues:
(1) Was the Club “established for charitable purposes only” for the
purposes of paragraph 1(1)(a) of Schedule 6 (“Issue 1(a)”)?
(2) Does s6 of the Charities Act 2011 prevent the Club from being 25 “established for charitable purposes” for the purposes of paragraph 1(1)(a)
of Schedule 6 (“Issue 1(b)”)?
(3) Did the Club satisfy the “registration condition” under paragraph 3 of
Schedule 6 (“Issue 1(c)”)?
4. If the Club loses on Issue 1, it was common ground that UK statutory provisions 30 mean that the appeal must fail. However, if the Club succeeds on Issue 1, the parties
were agreed that the appeal would succeed if the Club could establish either:
(1) that the new pavilion was intended for use solely by the Club otherwise
in the course or furtherance of a business for the purposes of Note 6(a) of
Group 5 Schedule 8 VATA 1994 (“Issue 2”); or 35
(2) that the new pavilion was intended for use solely by the Club as a
village hall or similarly in providing social or recreational facilities for a
local community for the purposes of Note 6(b) of Group 5 Schedule 8
VATA 1994 (“Issue 3”).
5. Issues 1 to 3 are all based on domestic UK legislation. Mr Brinsmead-Stockham 40 argued in his skeleton argument that even if the Club’s appeal failed as a result of the
3
application of UK law, the EU law principles of equal treatment and fiscal neutrality
would still enable its appeal to succeed (“Issue 4”). Mr Davey submitted that Issue 4
was raised late and should not be considered and we will deal with that procedural
issue later in this decision.
Evidence 5
6. The Club relied on witness evidence from Ian Miller who has been a member of
the Club for over ten years and has been its chairman since 2015. Mr Davey cross-
examined him. We were satisfied that Mr Miller was a reliable and honest witness.
HMRC did not rely on any witness evidence.
7. We also had evidence in the form of a bundle of documents. 10
Findings of fact
The Club and its constitution
8. The Club is located in Eynsham in Oxfordshire, a village with approximately
4,500 residents. In legal form, the Club is an unincorporated association. Since 29
September 2001, the Club has been the tenant under the lease of the School Piece 15 Field in Eynsham granted by the Bartholomew Educational Foundation (a registered
charity). That field is around one mile from the centre of Eynsham. At times relevant
to this appeal, the Club paid an annual rent of £450 to use the field.
9. At all material times, the constitution of the Club has described its objectives as
including: 20
- To promote participation within the local community in healthy
recreation by the provision of facilities for the playing of cricket.
- To promote the Club within the local community and within Cricket.
10. Membership of the Club is open to anyone (subject to payment of the subscription
fee) regardless of age, sex, race, creed or cricket ability. The club’s membership is 25 divided into two broad categories. “Playing members” are eligible to play cricket for
the club whereas “non-playing members” are not. The category of playing members is
itself subdivided into junior members (young people and children) and senior
members. As at 26 August 2016 (the date of Mr Miller’s witness statement), the Club
had 131 members of whom 75 were playing members and 56 were non-playing 30 members. All playing members have, at all material times, been amateur cricketers
and the Club does not employ any professional cricketers.
11. The annual subscription for a senior playing member is £70 (with a reduction to
£60 if paid before 1 June in the relevant year). That subscription is reduced to £15, for
those who are in full-time education or who are unemployed. The annual subscription 35 for a junior playing member is £30. The annual subscription for a non-playing
member is £5.
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