Trewby (on behalf of himself and the members of Hurlingham Club) v Commissioners of Customs and Excise
| Jurisdiction | England & Wales |
| Judgment Date | 01 April 1976 |
| Date | 01 April 1976 |
| Court | Queen's Bench Division |
Queen's Bench Division.
Mr. P.E. Whitworth (instructed by Messrs. Waterhouse & Co.) for the taxpayer.
Mr. R. Auld Q.C. and Mr. H. Woolf (instructed by the Solicitor for Customs & Excise) for the Crown.
Before: Geoffrey Lane L.J., Kenneth Jones and Goff JJ.
Value added tax - Exemption - Grant of a right over or licence to occupy land - Members club - Club owning land and providing facilities for its members - Members paying annual subscriptions for use of club facilities - Whether part of subscriptions paid for the grant of an interest in or right over land - Whether members had a licence to occupy the club land - section 13 subsec-or-para (1) section 45 subsec-or-para (1)Finance Act 1972, sec. 13(1) and 45(1)(b); schedule 5 group 1Sch. 5, Grp. 1, item 1 (now section 17 section 47 subsec-or-para (2)Value Added Tax Act 1983, sec. 17, 47(2)(b); schedule 6 group 1Sch. 6, Grp. 1, item 1).
This was an appeal by David Trewby, secretary of Hurlingham Club ("the taxpayer") on behalf of himself and all the members of the club against a decision of the London Value Added Tax (VAT) Tribunal dismissing an appeal against a decision of the Commissioners that part of the subscription paid by members of the Hurlingham club were referable to exempt supplies of licences to occupy land.
The taxpayer was an unincorporated members club which carried on its activities in 40 acres of land which were laid out as gardens, tennis courts and croquet lawns. Members paid a subscription to belong to the club and the club's facilities were available to all members without payment in addition to their subscriptions. The Commissioners raised an assessment against the taxpayer for VAT on supplies made to members in return for their subscription and entrance fees. The club appealed contending that, in return for his subscription and entrance fee, each member obtained a grant of an "interest in or right over land" or a "licence to occupy land" which was exempt under schedule 5 group 1Finance Act 1972, Sch. 5, Grp. 1, item 1. The Tribunal held that a member obtained a licence to use the club's ground but that that licence did not amount to a right over land or an interest in land or a licence to occupy land and was, accordingly, taxable at the standard rate.
Held, dismissing the taxpayer's appeal:
What a member obtained in return for his subscription was the privilege of going on the club's grounds and enjoying the facilities provided for sport and recreation. This was deemed to be a business under section 45 subsec-or-para (1)Finance Act 1972, sec. 45(1)(b) as "the provision of the facilities available to members". Accordingly it was subject to tax at the standard rate. It was not a "right over land", nor a "licence to occupy" any part of the club premises.
Geoffrey Lane L.J.: This is the judgment of the court. This is an appeal by David Forsyth Allan Trewby on behalf of himself and all other members of Hurlingham Club (hereinafter called "the Club") from a decision of the Value Added Tax Tribunal in London. The respondents are the Commissioners of Customs and Excise.
The Tribunal gave its decision on 28 August 1975 in proceedings under the section 40Finance Act 1972 sec. 40.These proceedings were themselves by way of appeal from the decision of the Commissioners of Customs and Excise whereby they assessed the Club in respect of VAT at a figure greatly in excess of that which the Club deemed lawful or proper.
These are the facts. The Club is an unincorporated members' association carrying on its activities in an area of some 40 acres laid out as gardens, tennis courts, croquet lawns and so on. The land lies on the north side of the River Thames near Putney Railway Bridge. The Club is a "taxable person" under the relevant enactments and was required by the part 1Finance Act 1972, Pt. 1 and theValue Added Tax (General) Regulations 1972, reg. 46(1) to furnish not later than 28 February 1974 a return showing the amount of VAT payable by them in respect of the period November 1973 through January 1974.
The Club sent in such a return showing the amount of £219.33 as being the sum properly payable.
The Club made no secret of the fact that in arriving at that figue it had excluded from the...
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