United Kingdom VAT & Duties Tribunals Decisions

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You are here: BAILII >> Databases >> United Kingdom VAT & Duties Tribunals Decisions >> Jacobs (on behalf of the Batchwood Hall Bowling Club) v Revenue & Customs [2006] UKVAT V19797 (04 October 2006)
URL: http://www.bailii.org/uk/cases/UKVAT/2006/V19797.html
Cite as: [2006] UKVAT V19797

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Edward Jacobs (on behalf of the Batchwood Hall Bowling Club) v Revenue & Customs [2006] UKVAT V19797 (04 October 2006)

19797

ZERO-RATING – whether Community Amateur Sports Club enjoying similar direct tax reliefs to a charity is entitled to zero-rating for the construction of a disabled toilet required by the Disability Discrimination Act 2004 – no – appeal dismissed

LONDON TRIBUNAL CENTRE

EDWARD JACOBS (ON BEHALF OF THE

BATCHWOOD HALL BOWLING CLUB) Appellant

- and -

THE COMMISSIONERS FOR HER MAJESTY'S

REVENUE AND CUSTOMS Respondents

Tribunal: DR JOHN F AVERY JONES CBE (Chairman)

JOHN BROWN CBE FCA

Sitting in public in London on 29 September 2006

The Appellant in person

Richard Smith, counsel, instructed by the Acting Solicitor for HM Revenue and Customs, for the Respondents

© CROWN COPYRIGHT 2006


 


DECISION

1. Mr Jacobs, the president of the Batchwood Hall Bowling Club, appeals on behalf of the Club against a ruling that the supply of construction services to the Club in building a new disabled toilet is not zero-rated. Mr Jacobs appeared in person; Customs were represented by Mr Richard Smith.
2. We find the following facts:

(1) As required by the Disability Discrimination Act 2004 the Club built a new extension block comprising male, female and disabled toilets. The work was completed in March 2006.

(2) The Club is on the register of Community Amateur Sports Clubs.

(3) Customs wrote on 27 January 2006 saying that the Appellant Club was not entitled to zero-rating for the proportion of the cost of the construction referable to the disabled toilets. That ruling was upheld on review on 6 March 2006. The Appellant Club appealed against the ruling on 13 March 2006.

3. Group 12 of Schedule 8 to the VAT Act 1994 zero-rates:

"12 The supply to a charity of a service of providing, extending or adapting a washroom or lavatory for use by handicapped persons in a building, or any part of a building, used principally by a charity for charitable purposes where such provision, extension or adaptation is necessary to facilitate the use of the washroom or lavatory by handicapped persons."

4. Mr Smith, for Customs, contends that the Club is not a charity, which in this context has a domestic law meaning; it is merely entitled to some of the direct tax benefits of a charity by Schedule 18 to the Finance Act 2002.
5. Mr Jacobs put his views in a moderate way and points out that that it is anomalous when the legislature required the Appellant Club to provide disabled toilets for direct tax branch of HMRC to treat the Club as if it were a charity but for the VAT branch to refuse it the VAT reliefs that would be available to a charity.
6. While we understand the Appellant Club's feeling that it is subject to anomalous tax treatment, we find that since the Appellant Club is not actually a charity there is actually no anomaly. Community Amateur Sports Clubs are given the direct tax reliefs, which are in some ways similar, but more limited than, those of a charity, for example they are subject to a maximum limit on exemption from tax on trading and property income. The fact that there is a Schedule setting out the reliefs to which such clubs are entitled emphasises that such clubs are not charities; if they were they would be entitled to the charitable direct tax reliefs anyway. Nor are such clubs subject to the strict supervision accorded to charities. There is no logical reason why such clubs should be entitled to the same VAT reliefs as a charity. Indeed we are probably prevented by European law from extending zero-rating to them.
7. We regret that we are therefore bound to dismiss the appeal.
8. We believe that this decision will come as no surprise to the Appellant who wanted to make quite sure that what he was being told by Customs was true. We record that Mr Smith said that if the Appellant Club could be registered as a charity it would be entitled retrospectively to the zero-rating, and this is something that the Appellant is considering. If that fails, then the Appellant Club will have to try to lobby to have the law changed as it is clear to us that they do not qualify under the law as it is.

JOHN F AVERY JONES

CHAIRMAN

RELEASE DATE:4 October 2006

LON/06/0331