A proprietary golf club has joined forces with a former women’s Open champion and launched an attack on a number of UK private members’ golf clubs over their tax arrangements.
As private members’ clubs do not distribute profits to incorporators, shareholders, directors or officers, they pay less corporation tax than proprietary clubs, which do. This has led to criticism from non-private members’ clubs over a lack of a level playing field when in it comes to investing money in the club’s facilities.
The Twitter feed of Trent Park Golf Club in north London, @trentparkgolf, has contacted Golf Club Management to say that ‘a lot of private golf clubs should die. There are too many, they aren’t paying corporation tax and most are ripping off the taxman.’
Some wealthy clubs in south east England were singled out by Trent Park as being the worst offenders.
The comments follow a meeting of the Association of Golf Club Owners (AGCO) at Abbotsley Golf Club in Cambridgeshire two weeks ago. AGCO describes itself as ‘a voice for owners of golf courses and their members, continuing to fight the unfair treatment of VAT and tax that is crippling the proprietary golf sector in the UK’. One of the items on the agenda at the meeting, hosted by former British women’s Open champion and founder of the Women’s Professional Golf Association, Vivien Saunders OBE, was ‘corporation tax – a century of evasion; the worst offenders’.
It is believed that, at the meeting, Vivien mentioned the clubs that Trent Park singled out, as she cited all of them in a letter to justice minister Jonathan Djanogly MP last year.
In the letter she stated ‘extraordinarily wealthy golf clubs don’t pay tax … £8.3 million of green fees at one since 1999 … we have never found a members’ club paying any tax on their green fee income, other than some negotiated pittance’.
She even added that John Cruddas, MP for Dagenham, receives a £700 discount on his subscription of one such club. “It smacks of favouring those with influence,” she stated.
Trent Park Golf Club added: “Private members’ golf clubs are evading corporation tax due on non-members’ visitors’ income by calling them ‘temporary members’. Corporation tax laws on non-member income already exists. They are just not being enforced by HMRC and auditors assist the cover up by private members’ clubs.
“If non-member green fee and society revenue is profitable, corporation tax is due, but none is paying it. If it’s not profitable, why do they do it?”
Last year Burhill Golf and Leisure, which runs several golf clubs for profit, stated that the corporation tax system does not need to be changed, but that the VAT rate for proprietary-run sports organisations should be removed on activity-based income, as is currently the case for private members’ clubs, which Vivien Saunders has also campaigned for.
“Commercial organisations already pay corporation tax which private members’ golf clubs do not – and this should be sufficient,” said chief executive Colin Mayes. “But we are all sports facilities and use various income streams to maintain and improve our facilities for our customers’ benefit. Clearly the commercial clubs are losing out quite considerably.”
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