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VAT on Chess lessons?

I have a client who teaches chess to individuals and schools and he is nearing the vat registration threshold, will he have to register and then charge vat on his lessons?

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depends

if he is operating as a sole trader, the lessons will be exempt.

if he is operating as a limited company he will have to charge VAT.

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Why is it different for a sole trader and a limited company

Tonykelly wrote:

if he is operating as a sole trader, the lessons will be exempt.

if he is operating as a limited company he will have to charge VAT.

Why is it different for a sole trader and a limited company?

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What an awesome job

Nothing more to say - I wish I had that job !! Better then being a porn star in my geekish opinion.

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because

private tuition of a nature normally taught in a school, by an individual acting idependently of an employer, is exempt (VATA1994 Sch 9).  A sole trader has no employer, the provision of education through the limited company introduces the employer.

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.

Is chess normally taught in a school? Perhaps us public schoolboys have missed out!

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Of course it is

We had it on Tuesday mornings, just after advanced hunting techniques and before the 2 hour 'which fork to use to eat a bannana' class.

Only oiks wouldn't have learned chess at school!

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In place of

Constantly Confused wrote:

We had it on Tuesday mornings, just after advanced hunting techniques and before the 2 hour 'which fork to use to eat a bannana' class.

Only oiks wouldn't have learned chess at school!

Was that in place of spelling?

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.

petersaxton wrote:

Constantly Confused wrote:

We had it on Tuesday mornings, just after advanced hunting techniques and before the 2 hour 'which fork to use to eat a bannana' class.

Only oiks wouldn't have learned chess at school!

Was that in place of spelling?

 

Just so.  Spelling took a back seat at my school, as long as a boy could hit a six, sing the school song very loud and take a hot crumpet from behind without blubbing, education could go hang.

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Hot crumpet!

No crumpet (hot or cold) at my school. It was boys only.

 

Constantly Confused wrote:

Just so.  Spelling took a back seat at my school, as long as a boy could hit a six, sing the school song very loud and take a hot crumpet from behind without blubbing, education could go hang.

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I was still toying with the idea...

... of becoming a porn star.  Now I'm concerned because I'm unsure which fork one eats one's banana with!

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George - a banana fork, of course

Doesn't everyone know that??? ;)

http://creativelifeskills.blogspot.com/2010/11/really-useful-banana-fork.html

 

 

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Unzip a bandana

My teacher made me stay in after school and write 100 lines for talking in class about a fork in banana.

Go here to see the CAMP way to eat a banana. [What a gay day, Larry. How the mind boggles at that one.]  http://www.mindfuleating.org/banana.html

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Thank you...

... back to my career as a porn star then!

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Semantics

Shouldn't that be PAWN star?

 

George Attazder wrote:

... back to my career as a porn star then!

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I can see problems ahead ...

.. will the banana stay still long enough for it be attacked by a fork?

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Chess at school

We didn't have chess lessons but had a chess club on lunchtimes.... I joined it as it meant I could sit inside for an hour whilst everyone else was out in the rain!!

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Hint in the question....?

Whilst the thread has had me chuckling into my banana, the original poster said his client taught chess in schools as well as to individuals so we have proof it is taught in schools (though I must say I never learned it there).

If so, Tony Kelly and Dave Gibson have it spot on. The supplies will be exempt from VAT.

If his turnover increased further, he should probably not incorporate as the VAT he would then have to account for (1/6th of his turnover as he would be unlikely to be able to pass on the VAT in his prices) would outweigh any direct tax savings from incorporation.

Regards (from Adelaide this fine night - business, you understand, not a holiday heaven forbid)

Malcolm

Malcolm Greenbaum

Director - Greenbaum Training & Consultancy Limited

IFRS, US GAAP, UK GAAP, UK Tax and VAT

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Why didall  the girls in the

Why didall  the girls in the lunchtime chess club constantly ask why my banana was in my pocket when all the time it was obvious it was  in my banana box ( see link above)

 

I have puzzeled about that for years.

 

And if hes so busy teaching chess he gets an assistant then the assistant has an employer and vat rears its ugly banana shaped head. But if you get really big you can get a CIC and then theres no vat.

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CIC?

Why is there no VAT with a CIC? a CIC will still be an employer the same as any other company, and cannot be a charity, and so would be providing education through employees, and not as an eligible body.

I suppose it could make itself an eligible body by adopting a non distribution clause for profits etc, but then directors would be on a set wage 'reasonably' set for the work they do and profits would become meaningless for them, and it all seems a little long winded and uncertain to maintain the exemption.

Now a LLP may be feasible.

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somehow

a fluffer and a banana sems to go rather well together

 

PS chess lessons are expensive these days!

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VAT on dance lessons

Does the exemption apply to a partnership which provides dance lessons.

One of the partners teaches but teaching is mainly carried out by sub-contractors and on occasion by employees.

Thanks,

James

 

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I'll have to check, mate

Well someone had to say it didn't they!!!

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I agree

It was never going to be black and white.

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Not sure of this answer to the OP as I'm a rookie, so I'll have to check. 

I'll do it this very knight just before my pawn cocktail.

Sorry if my puns are a bit stale mate!

 

 

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seriously

if it can be taught is it deemed to taught in schools - where is the line drawn national curriculum 

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normally taught in a school

Usually means there the regular subjects that are examined and so can include sport,  dance, drama. 

I expect someone will come up with an instance wherein Chess has been successfully got past an inspector but I suspect this is an area where HMRC avoid authoritative judgements so they can continue to argue individual cases at tribunal.

Cynical? Moi?

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VAT - the little or no risk answer

No-one has yet suggested that you ask the VAT Office and get their response in writing.

6 years ago I asked for VAT advice and was told my business was VAT Exempt.  They have now come to me for £250,000 and a £50,000 penalty.

I am fighting it and doing okay so far.  But it might (and I emphasise might) have been a wholly different situation if I had taken the precaution of getting HMRC's answer in writing.  At the time, the advice was unequivocal that I was exempt and it would have felt churlish to ask for written confirmation - my understanding though is that you have to put it in writing to HMRC in the first place.

If your Chess Teacher really wants to do his very best to comply, I would ask HMRC for a written answer.  Imagine 6 years down the line being told that the advice you were given on the Accounting Web was wrong and you owe hundreds of thousands of pounds.

And if HMRC refuses to put the advice in writing, do let us know on here!

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@SimonP

its hard to tell if you were in a school  or an institution!

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@carnmores

carnmores wrote:

its hard to tell if you were in a school  or an institution!

Whilst I have totally missed the point you were trying to make, I must point out that schools are (educational) institutions. Perhaps that is why you could not distinguish between them, since they are one and the same.

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pedant!

some are more fun than others

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@carnmores revisited

carnmores wrote:

some are more fun than others

 

Thank you but I would prefer to think of myself more of a 'purist' than a 'pedant'. As an accountant, I believe that accuracy and precision are more important than worrying about insignificant detail. I also do not take myself too seriously, unlike some other people.

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lol

you cannot be serious ;-)

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Chess in Schools and Communities (CSC)

Quite topical at the moment:

Recently, there was an early day motion submitted to parliament concerning expanding chess in schools.

Also recently, the charity (CSC) has been featured on the BBC on BBC breakfast.

And, of course, you have your London Chess Classic at Olympia going on 3rd - 12th.

http://www.londonchessclassic.com/

http://www.chessinschools.co.uk/

Attention site arbiters: please note this post is not self-promotion of any kind, as I am not affiliated with any of the above organisations.

 

 

 

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