Biker Club Wins VAT case

Many clubs offer members a range of services for their membership fee. For example, membership may include a members’ magazine. Ordinarily, a magazine subscription should be zero rated for VAT purposes, but when the magazine element is bundled into a general club subscription – that is standard rated for VAT – problems can arise.

HMRC is prone to view the “bundled” price as a standard rated supply, whereas the affected organisation would prefer to separate out the zero-rated element thus reducing the cost to their members.

In a recent case, the Harley Owners Group challenged such a fixed supply argument raised by HMRC. They argued that the members’ magazine was a separate supply and should be considered zero-rated, and the courts agreed.

The delivery of mixed services under an umbrella membership subscription is an area of VAT law that is far from clear. However, HMRC has lost a number of cases recently with a similar outcome to the Harley Owners Club.

Get the latest updates

Make sure that you’re following our website and sign up for the Jones Harris enewsletter here

Don’t forget we’re also on Twitter @JHAccountants and you can follow our LinkedIn business page, Jones Harris Accountants

There are
good reasons
why we’re
Lancashire’s

No. 1

The Jones Harris Difference
  • A personal, dedicated contact
  • Free strategic advice on growth and profitability
  • Free, unlimited telephone / email support
  • Proactive tax advice and analysis
  • Profitability checks via competitor benchmarking
  • A steady flow of good money-saving ideas
  • Active business network introductions
  • Secure client web-space for document sharing
  • No need to email important/sensitive data
Contact us