After the Bridport case determined that golfing activities on the course by individuals were exempt many clubs continued to claim a proportion of the input VAT on course expenses where they had tee advertising, buggy hire and Corporate golf days which have been considered to be standard rated. At the Bridport Tribunal it was stated that buggy hire or tee advertising income, both of which are standard rated, this were sufficient for VAT on course maintenance costs to continue to be treated as ‘residual’ and eligible for partial recovery calculated by reference to a partial exemption method.
However 6 months later in May 2016 HMRC issued guidance in Information Sheet 01/15 which states "Letting of space to permanently attach an advertising billboard or hoarding is a VAT exempt supply unless a valid option to tax has been exercised on the property."
Does anyone have any experience or opinion on whether an advertisement on a permanent structure placed at a tee (whether it is painted, stuck on or a metal plate screwed on) would be considered to fall into HMRC's interpretation of an exempt supply and ultimately lead to a smaller percentage of input VAT being able to be recovered on course expenses.
I have asked many people and the impression I get is that most are still treating the tee advertising/sponsorship as standard rated which allows a larger percentage of course input VAT to be recovered. Is anyone aware of HMRC's position or of the outcome of any decision on this following a visit?