I act for a number of Golf Professionals , some of whom are Sole-traders and others who trade through their own Ltd Company.
The question has arisen as to the VAT status of Golf Lessons provided as I have received conflicting advice on 2 occasions from the Helpline.
Am I correct in saying that the lessons provided by the Sole Trader are exempt, whilst those povided by the Director/Employee are Std Rated ?
Replies (4)
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I believe and hope so!
Private tuition is exempt from VAT providing it is “taught independently of an employer” VAT Act 1994 Schedule 9 Group 6 Item 2.
For a sole trader, it is clear these lessons are exempt providing they are given personally and not by an employee of the trader.
A limited company director has an employer - namely the company. Hence no tuition is deemed to be private.
This is the advice I've given to several dance teachers who were considering incorporation. From a tax point of view, the extra VAT and hassle of being registered normally outweighs the reduction in NI from incorporating.
I'm not sure which school you went to ...
... but is golf a subject normally taught at school or university? It would seem so - Marcus Webb
Unfortunately, the wording of that decision is not particularly helpful - it simply says that the supplies of one individual providing tuition as an employee are not exempt - it does not seem to address the fact that the individual in question was also making supplies as a self-employed person (ie does not indicate whether or not those supplies could remain as exempt)
Private Tuition
The stipulation is that as well as being an individual, the subject being tutored has to be "regularly" taught at School/Universities".
Golf, it seems is, although it was not at my school and I would not be too happy to consider this is what we spend the tax on.
I don't know how many schools/universities a subject has to be taught in to be considered "regularly" but as I can well suppose that private schools offer all manner of sporting options - shooting, sailing, fox hunting, Eton Leapfrog etc it would seem that this could all qualify too.
typically woolly rule
A typically woolly rule, what a surprise! I live near a school with 2,000 pupils. I can confirm that golf is regularly taught there, as can any HMRC official who cares to examine the playing fields in summer - sure to find a few balls in the hedges! I am not sure that dance is regularly taught there, however - but I am very confident that dance is OK by HMRC due to the many VAT cases involving dancing schools! I don't have a golf, cricket, hockey, tennis, triatholon, rowing pro on my books but if I did I'd be claming it as private tuition, advising my client to get tax insurance and being ready for any challenges.