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    What Has Queen's Club Got That Others Don't?

    In an interesting VAT case, the well-known tennis club Queen's Club has been successful in a claim for recovery of the VAT it incurred on revamping its restaurant and bar facilities.

    The club gives access to tennis, squash, real tennis and rackets for its members, who in 2012/13 paid an annual membership fee of £1,820. It has a long waiting list, with applicants having to wait several years before becoming members. The club is what is called 'partially exempt' for VAT purposes, meaning that it makes both exempt and standard-rated supplies. The practical effect of partial exemption is that it usually acts to restrict the amount of VAT which can be reclaimed.

    The decision swung on the fact that the club has always emphasised the provision of sporting facilities. It is interesting because a number of recent similar cases have gone against the clubs concerned.

    In this case, the claim was successful because the judge ruled that 'there was no direct and immediate link between the renovation goods and services and exempt supplies that the Club made. There was plainly a direct and immediate link between those goods and services and taxable supplies that the Club made.'

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    Careful planning can help ensure that a charity or any other partially exempt business entity does not compromise its VAT position. Contact us for advice.

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