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Summer Sports Camps – Supplies of Welfare, Education or Sport?

15th Aug 2016
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There is a growing list of Tribunal decisions addressing this broad area of activity camps. The latest decision concerned Sports Academies Ltd, held summer activities for 3-17 year olds in 10 locations. The company did not pursue an Appeal under the Education or Sports exemptions, as it was not an ‘eligible body.’ It was left with an Appeal under the Welfare exemption.

The Welfare exemption came into force in 2002, and introduces Item 9 and Note 6 into the Group. Note 6 reads:

'In Item 9, “welfare services” means services which are directly connected with-

(a) the provision of care, treatment, or instruction designed to promote the physical or mental welfare of elderly, sick, distressed, or disabled persons;

(b) the care or protection of children and young persons, or

(c) the provision of spiritual welfare by a religious institution as part of a course of instruction of a retreat, not being a course or a retreat designed primarily to provide recreation or a holiday.”'

This left the company the task of bringing its activities within Note 6(b).

Although evidence was given by an employee of the company, the decision includes numerous references to the company website, and little reference to the employee’s evidence.

The Tribunal seems to state the principle argument: ‘whether, objectively, the recipients of that service … would regard the nature of the camps as arrangements for the care or protection of children and young people.’ Surely, methinks, the view of the recipients, ie: the parents who are paying for their children to attend, is not the real issue, although it is a factor to be considered. The real question is a factual one: ‘Do the activities provided at the camps constitute care or protection of children and young people?
I am also concerned at a comment that, some years earlier, when the company did seek registration for VAT, it must have considered that its activities fell outside the exemption. Again, the earlier opinion of the company is irrelevant, (and that leaves aside any argument that the activities had altered in the intervening period.)

The full decision is here: http://www.bailii.org/uk/cases/UKFTT/TC/2016/TC05171.html

Comment: given the wide range of summer activities organised by commercial as well as charitable groups, it is essential that there is clear advice as to the VAT status of the event. And this should be updated, to reflect changes in the activities, as well as case law developments.

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