British Chess Championship VAT added

Debate directly related to English Chess Federation matters.
Louise Sinclair
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British Chess Championship VAT added

Post by Louise Sinclair » Mon May 28, 2012 2:07 pm

I received a few entry forms from the British Chess Championship to display at the Sam Black Blitz (shameless plug) and I looked through the form. I was surprised to see that VAT is levied on the entry fees - is this a new development.Titled players get discounts and free entry so it would appear that only the proletarians pay this tax at the tournament.
Louise
You might very well think that ; I couldn't possibly comment.
' you turn if you want. The lady's not for turning'

Sean Hewitt
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Re: British Chess Championship VAT added

Post by Sean Hewitt » Mon May 28, 2012 2:27 pm

Louise Sinclair wrote:I was surprised to see that VAT is levied on the entry fees - is this a new development.
No. It's certainly been the case for at least the last 10 years. I would imagine it's been the case ever since the BCF as was became VAT registered.

Roger de Coverly
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Re: British Chess Championship VAT added

Post by Roger de Coverly » Mon May 28, 2012 2:40 pm

Sean Hewitt wrote: No. It's certainly been the case for at least the last 10 years. I would imagine it's been the case ever since the BCF as was became VAT registered.
It goes back, if not to the start of VAT in 1973, but certainly to a tax decision a few years later about aggregation. There was a "London Chess Association" formed to co-ordinate London chess events. This was disbanded in financial form anyway, when it was realised that the turnover of events when aggregated exceeded the VAT threshold.

A good excuse to separate the British Championship Congress from the rest of the ECF should have favourable VAT consequences if it could be achieved. Also the ECF has to resist the temptation of offering its services to run independent Congresses as they might lose their tax independence.

Louise Sinclair
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Re: British Chess Championship VAT added

Post by Louise Sinclair » Mon May 28, 2012 2:44 pm

Presumably this isn't the only situation where the ECF levies VAT. What happens with the Game Fee?
Louise
You might very well think that ; I couldn't possibly comment.
' you turn if you want. The lady's not for turning'

John Philpott

Re: British Chess Championship VAT added

Post by John Philpott » Mon May 28, 2012 2:51 pm

Game Fee is vatable, as are membership subscriptions, County Championship and National Club entry fees etc. etc.

Roger de Coverly
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Re: British Chess Championship VAT added

Post by Roger de Coverly » Mon May 28, 2012 2:55 pm

John Philpott wrote:Game Fee is vatable, as are membership subscriptions, County Championship and National Club entry fees etc. etc.
Almost every source of income including sponsorship is hit. It's easier to list the exceptions, voluntary work would be one, genuine donations and bequests another? DCMS grant was another exception.

Louise Sinclair
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Re: British Chess Championship VAT added

Post by Louise Sinclair » Mon May 28, 2012 3:05 pm

This sounds like a nice little earner for the government. I won't be recommending Game Fee to NCCL and I have an idea the entry forms for the championship have been disposed of in the appropriate fashion.
Louise
You might very well think that ; I couldn't possibly comment.
' you turn if you want. The lady's not for turning'

Paul Buswell
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Re: British Chess Championship VAT added

Post by Paul Buswell » Mon May 28, 2012 5:54 pm

Louise Sinclair wrote:This sounds like a nice little earner for the government. I won't be recommending Game Fee to NCCL and I have an idea the entry forms for the championship have been disposed of in the appropriate fashion.
That seems a somewhat petulant respobnse. VAT has been charged on BCF/ECF membership income since 1975: I remember the then Treasurer's paper on the matter. The BCF/ECF has always complied with its legal obligation to account for VAT and if that amount is now being shown more clearly (I have not seen the entry form referred to) then that is a step in the right direction.

PB

Lara Barnes
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Re: British Chess Championship VAT added

Post by Lara Barnes » Mon May 28, 2012 7:00 pm

I have an idea the entry forms for the championship have been disposed of in the appropriate fashion.
Why would an (elected?) chess organiser throw out (which is what you are suggesting) the entry forms for a national event? Just because you do not wish to participate does not mean that others do not so your attitude is selfish in the least. Some of the people who want to play at the event cannot afford to pay the full entry fee so I have subsidised and even waived the fee in some cases.

My colleagues in the Northumberland Chess Association and folk from all over the country have put up thousands of pounds of their own money to help people out at the event not to mention the many social events planned that won't cost anyone anything.

I have asked the ECF office to distribute forms (which I spent many hours designing and having printed) to as many events as possible and to have someone suggest that the forms and therefore the event is a waste of time is very disappointing.

For those who did not manage to get an entry form due to this attitude and would like to enter one of the 26 official events or several 'fun' events please see the website http://www.britishchesschampionships.co.uk

Stewart Reuben
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Re: British Chess Championship VAT added

Post by Stewart Reuben » Wed May 30, 2012 5:20 am

Although the ECF has to pay VAT on the entry fees to the British Championships I have been told that the overall effect on the finances is rather small as we are able to reclaim vattable expenses. The most obvious of which is the hotel bill for the admin team. This makes the comment by Louise Sinclair even more ill-informed.
If there is still to be a programme I hope that has as high a cover price as possible. This is because then that portion of the entry fee is not vattable. In poker the portion of the entry fee that goes towards the prizes is not subject to vat. I have never understood why poker has a favourable tax situation!
Nonetheless it does wrankle that entry fees for sports are not subject to vat. When we first argued about that in the 1970s, the reply from the treasury was something like, 'A line has to be drawn somewhere and it has been drawn in favour of participatory activities for young people'. This of course is more true of chess than almost any other activity.

E Michael White
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Re: British Chess Championship VAT added

Post by E Michael White » Wed May 30, 2012 8:36 am

Stewart Reuben wrote:Although the ECF has to pay VAT on the entry fees to the British Championships I have been told that the overall effect on the finances is rather small as we are able to reclaim vattable expenses. The most obvious of which is the hotel bill for the admin team. This makes the comment by Louise Sinclair even more ill-informed.
If there is still to be a programme I hope that has as high a cover price as possible. This is because then that portion of the entry fee is not vattable. In poker the portion of the entry fee that goes towards the prizes is not subject to vat. I have never understood why poker has a favourable tax situation!
Nonetheless it does wrankle that entry fees for sports are not subject to vat. When we first argued about that in the 1970s, the reply from the treasury was something like, 'A line has to be drawn somewhere and it has been drawn in favour of participatory activities for young people'. This of course is more true of chess than almost any other activity.
Stewart.
Vat at the British Championships is almost entirely optional.

If the ECF were organised as a charity, VAT could be eliminated on entry fees and I would expect part of the entry fee to be treated as premises entry and therefore attract tax relief by way of gift aid. Despite the top section being partly professional I expect this could be organised as a charity fund raising event. Whatever charitable approach is used I cannot see it being more expensive than the current way. The ECF way of looking at the Championships as Vat neutral is very muddled.

The ECF board have been most remiss in not actioning charitable status over the last 5 years.
Paul Buswell wrote:The BCF/ECF has always complied with its legal obligation to account for VAT...
….. but not with the expectation of members for cost efficiency in running the event as a charity or partly before 2008.
John Philpott wrote:Game Fee is vatable, as are membership subscriptions, County Championship and National Club entry fees etc. etc.
Would you include as vatable income the Holowczak fines described here ? http://www.ecforum.org.uk/viewtopic.php ... how#p88513

Competitors may think the ad habitus value is less than positive. Why not refund, to the opponents, the part of the fee that relates to that match instead and try reclaiming some vat ?
Last edited by E Michael White on Wed May 30, 2012 8:11 pm, edited 1 time in total.

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Carl Hibbard
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Re: British Chess Championship VAT added

Post by Carl Hibbard » Wed May 30, 2012 6:08 pm

E Michael White wrote:Competitors may think the AH value added is less than positive. Why not refund, to the opponents, the part of the fee that relates to that match instead and try reclaiming some vat ?
I presume you mean Alex in your post, so you could be perhaps edit your comments to something more polite please

A lot of us do have first names :roll:
Cheers
Carl Hibbard

E Michael White
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Re: British Chess Championship VAT added

Post by E Michael White » Wed May 30, 2012 8:23 pm

This statement was to point out the irony of a situation where the county tournament secretary causes a payment to be made to the department of Her Majesty's Revenue and Customs who consider value is added and levy some Value Added Tax for this ad habitus action. But should we wait and see what John Philpot has to say about whether value added tax is payable. If it is the £ 255 collected so far would result in £50 or so to those who removed the Department for Culture Media and Sport grant to the ECF.

While I'm typing there is a certain irony in the proposed methods for collection of game fee/membership contributions many of which suggest central collection via leagues or counties; this will make the route to charitable status more costly and more difficult. The ECF will no doubt make unattainable the only opportunity offered by the Government to bring new funds in.
Last edited by E Michael White on Wed May 30, 2012 8:38 pm, edited 1 time in total.

Mike Truran
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Re: British Chess Championship VAT added

Post by Mike Truran » Wed May 30, 2012 8:37 pm

ad habitus
:?:

E Michael White
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Re: British Chess Championship VAT added

Post by E Michael White » Wed May 30, 2012 8:44 pm

Mike Truran wrote:
ad habitus
:?:
Following a habit without considering side effects - to you and me Mike but see also :-

http://en.wikipedia.org/wiki/Habitus_(sociology)

Do you as an accountant know whether the fines will attract VAT ? Should it have been charged in the past ?