"SavetheUKCC" petition

[Nick Grey]

Mike ought to have got engagement from parents or self employees of his own business.
This is not to make light of those self-employees going into schools for this or any activity.
Of course they will check the relevant parts especially self-employment/insurance before putting through their books.
Then again who are the best at educational attainment or children social care in a local authority area & that will give you a rather big clue on where I work.

[Roger de Coverly]

From what I understand of it, the UK Chess Challenge business was essentially in two parts. The first was the supply of a set of materials which enabled the school to run and present modest prizes for an in school chess tournament. The second was a more conventional set of tournaments with individual entry from those who qualified from the school stage.

The problem with VAT was a matter of size. There were enough schools and qualifiers that the sum of £ 40 times number of schools plus £ 15 times number of qualifiers exceeded the VAT small turnover exemption. Done properly, it may that VAT on material purchased for schools could be reclaimed by UKCC and that the VAT deemed included in the £ 40 school cost could be reclaimed by the school.

It's a merry go round but that's VAT for you.

I don't know the economics of UKCC but just assume that the school stage is run to break even. So UKCC purchases £ 40 worth of materials and hands this over to a school. UKCC can get an invoice from its supplier that the £ 40 was £ 33.33 of goods and £ 6.67 of VAT. It can then tell the school that the £ 40 entry fee contains £ 6.67 of VAT. As the middleman, UKCC's VAT bill is in fact zero, but it has to prove the point by filling in the paperwork and keeping the right kind of records.

[Nick Grey]

Roger you know nothing about VAT & schools. It is not school business activity, cannot put it through on behalf of UKCC.
It is not a Merry go round. Which is why HMRC are after £300k.
Absence of the accounting records is something else.

[Roger de Coverly]

Roger you know nothing about VAT & schools. It is not school business activity, cannot put it through on behalf of UKCC.

There are suggestions that schools can reclaim VAT on services purchased. Whether this is correct, I wouldn't be certain. Could experts in this field comment please?

It's relevant to the finances of whatever successor organisation picks up the UKCC as to how it handles VAT.

The National Schools and similar competitions are run in the name of the ECF. If there's an entry fee, it would include VAT. Can this be reclaimed by the school?

[JustinHorton]

Absence of the accounting records is something else.

And quite an eyebrow-raising something else, to the layman.

[Alex Holowczak]

Roger you know nothing about VAT & schools. It is not school business activity, cannot put it through on behalf of UKCC.

There are suggestions that schools can reclaim VAT on services purchased. Whether this is correct, I wouldn't be certain. Could experts in this field comment please?

I'm not the VAT expert you crave, but Google suggests it is a function of:
(1) The type of activity, and
(2) The type of school.

Nick apparently works for a LEA, whereas the school that asked me is an independent school. So that might explain the difference of approach.

[Roger Lancaster]

I'm not that expert either but "unable to reclaim" suggests the writer may be under a misunderstanding. It's not a question of reclaiming VAT but of offsetting it. So if, for example, a school's services are VAT-exempt (which may vary from one type of school to another - I stress I'm no expert on the finances of academic institutions) then, although in theory it could offset, in practice there would be nothing to offset against because its own invoices carried no VAT.

[Michael Flatt]

I'm not that expert either, but the rules regarding VAT exemption[1] might have been misinterpreted by proposing that chess is an educational activity rather than a game.

The competition is organised by an exernal body, Delancey UK Chess Challenge, and not the school. The school pays entry fees to UKCC on which VAT is chargeable.

[1] VAT exemption: https://www.gov.uk/guidance/vat-exempti ... -exemption

[John Swain]

Roger you know nothing about VAT & schools. It is not school business activity, cannot put it through on behalf of UKCC.

There are suggestions that schools can reclaim VAT on services purchased. Whether this is correct, I wouldn't be certain. Could experts in this field comment please?

I'm not the VAT expert you crave, but Google suggests it is a function of:
(1) The type of activity, and
(2) The type of school.

Nick apparently works for a LEA, whereas the school that asked me is an independent school. So that might explain the difference of approach.

I have been reliably informed that an independent school cannot reclaim the VAT on a tournament entry fee, whether tennis, chess or whatever. I do not know whether this also applies to state schools. An expert's view is required. I don't know what proportion of the UKCC entries came from the independent sector.

The bulk of the UKCC's non-sponsorship income in any case came from the parents who paid £15 for their child to play in the Megafinal, Gigafinal or Terafinal. They wouldn't be able to reclaim VAT either.

[John Upham]

I have been reliably informed that an independent school cannot reclaim the VAT on a tournament entry fee, whether tennis, chess or whatever. I do not know whether this also applies to state schools. An expert's view is required. I don't know what proportion of the UKCC entries came from the independent sector.

The bulk of the UKCC's non-sponsorship income in any case came from the parents who paid £15 for their child to play in the Megafinal, Gigafinal or Terafinal. They wouldn't be able to reclaim VAT either.

Is this regardless of whether the school is VAT registered or not?

[John Swain]

I have been reliably informed that an independent school cannot reclaim the VAT on a tournament entry fee, whether tennis, chess or whatever. I do not know whether this also applies to state schools. An expert's view is required. I don't know what proportion of the UKCC entries came from the independent sector.

The bulk of the UKCC's non-sponsorship income in any case came from the parents who paid £15 for their child to play in the Megafinal, Gigafinal or Terafinal. They wouldn't be able to reclaim VAT either.

Is this regardless of whether the school is VAT registered or not?

As I understand it, and an expert may correct me, an independent school may only reclaim VAT on its own commercial activities, presumably things like the hire of its facilities to the public.

[Ian Kingston]

For the benefit of anybody capable of unravelling all the implications, here's HMRC's VAT Notice 701/30: education and vocational training.

[Andrew Martin]

Has anyone any news at all as to whether the UKCC will run in 2017?

[John Upham]

Has anyone any news at all as to whether the UKCC will run in 2017?

I'm confident UKCC will go ahead. The variables are:

1. Who will be the new owners?
2. Will the new owners see fit to include MJB and his team in the organisation? (not in any way to do with the finances!)

If the owners choose No as the answer to 2. then it could easily fail.

If they wisely choose Yes then UKCC could easily prosper and grow to something more successful then we've been used to.

[John Swain]

Has anyone any news at all as to whether the UKCC will run in 2017?

I'm confident UKCC will go ahead. The variables are:

1. Who will be the new owners?
2. Will the new owners see fit to include MJB and his team in the organisation? (not in any way to do with the finances!)

If the owners choose No as the answer to 2. then it could easily fail.

If they wisely choose Yes then UKCC could easily prosper and grow to something more successful then we've been used to.

It's good news that the UKCC is likely to continue in 2017.

I hope that "UKCC mark II" will give some serious thought to the contents of the box which is sent out to secondary schools. Badges are fine, perhaps even gold spots to stick on them, but something needs to be found more appropriate than cuddly mascots (fine for those of primary school age but seen as naff by older children).