Sports clubs have long sought parity with charity.

In collaboration with the Central Council of Physical Recreation, the National Playing Fields Association, Richard Baldwin (of Deloitte & Touche) and Lord Phillips of Sudbury, Sport England has actively campaigned for recognition that amateur sports clubs are at the heart of community life and contribute significantly to the fabric of society.

On 30 November 2001, the Charity Commission announced that it would now recognise as charitable: "The promotion of community participation in healthy recreation by the provision of facilities for the playing of particular sports."

Then on 17 April 2002, in his Budget, the Chancellor of the Exchequer introduced a package of tax reliefs to support Community Amateur Sports Clubs (CASCs) as an alternative route for those CASCs unable or unwilling to apply for charitable status.

See the HM Treasury press release on this subject:
Community sport is tax winner – 25 July 2002

Sports clubs are now free to choose to apply either to the Charity Commission for charitable status, and the tax treatment that accrues to it, or directly to the Inland Revenue for the tax reliefs specifically for CASCs.

We welcome these tax breaks and the flexibility offered.

Still greater benefits are likely if recommendations made on 25 September 2002 by the Strategy Unit of the Cabinet Office come to fruition.

Their report, entitled Private Action, Public Benefit, proposes that the advancement of amateur sport should become one of ten new charitable purposes.

Sport England has now responded to the detailed recommendations
Private_action_public_benefit_response.pdf (124 Kb)

We look forward with confidence to a strengthened role for sports clubs in the future.

Detailed guidance
For advice and guidance on existing measures you should contact the Charity Commission and the Inland Revenue directly

The Charity Commission's enquiry line is 0870 333 0123, or visit their website.

The Inland Revenue can be contacted on 0131 777 4147 or visit their website.

However, Sport England is pleased to offer the following information about the two options and related issues. We do not, however, comment here on the Cabinet Office proposals here.

Please note, whilst every effort has been made to verify its accuracy, Sport England cannot be held liable for any loss or costs arising directly or indirectly from reliance on this information.


Common questions

What kind of club is eligible?
Community Amateur Sports Clubs (CASCs). The club must be properly constituted as a not-for-profit organisation, with no provision for payment to members during the life of the club or upon dissolution. It can be either unincorporated (ie an association of members with unlimited liability) or incorporated as a company limited by guarantee (not shares). Proprietary and private members clubs would not be eligible.

The club must operate an open membership policy that allows anyone, within reason, to join and use its facilities

What sports are eligible?
Notwithstanding the Cabinet Office report, the Charity Commission is constrained by current charity law and can only grant charitable status where the sport in question is capable of improving physical health and fitness.

They identify nine sports that appear not to meet their criteria:

• Angling
• Ballooning
• Billiards, Pool and Snooker
• Crossbow
• Rifle and Pistol Shooting
• Flying
• Gliding
• Motor Sports
• Parachuting

Although applications will still be considered if they demonstrate clear benefits to a participant's physical health.

The Inland Revenue regard as eligible those sports recognised by the national sports councils.

Can the club operate exactly as it does now?
In many cases, yes. But to become a charity, the club constitution will have to be amended so that its stated purpose is specifically and exclusively charitable. Sport England and the CCPR will be working with governing bodies of sport to develop model constitutions acceptable to the Charity Commission.

Can the club still select its best players for competitive leagues and tournaments?
Yes, so long as those members who choose not to play competitively, or are not selected, are not then prevented unreasonably from participating when and how they want to. Similarly, any coaching that is available should be offered to all members, not just the most talented or skilful.

Are there any rules about trading activities?
Refreshments provided in connection with playing activities (eg during and after matches or training) are acceptable, but the Charity Commission stipulates that purely social activity would need to be accounted for separately, as it is not 'charitable' (although tax relief would be available on profits covenanted to the club). The Inland Revenue accept social activities as an adjunct to playing sport, provided that the main emphasis of the club is on playing rather than spectating or socialising.

Can the club carry on social activities?
Yes, but we would expect most of its efforts to be directed at what the legislation requires to be its main purpose, providing facilities for, and promoting participation in, an eligible sport.

We would expect the majority of club members to be involved in sport in some capacity. The scheme has no problem with a club that provides facilities, such as a bar or even facilities for a non-eligible sport like darts, provided this is ancillary to its main purpose.

What the scheme is not there to support is a pub with a football pitch outside

Non-playing volunteers and helpers are acceptable, but people intending only to take advantage of the club's social facilities are not eligible for the benefits of charitable status, so the club should not have a social membership category.

Strictly social activities, unrelated to participation in sport, would need to be organised separately (although tax relief would be available on profits covenanted to the club).

Is it easy to register?
Relatively so. Both the Charity Commission and the Inland Revenue have tried to minimise the bureaucracy, within the constraints of legislation and accountability. Application forms are readily available and not difficult to complete. Some clubs may need to amend their constitution to meet requirements.

Where can the club obtain an approved model constitution?
The Inland Revenue approved model constitution and model clauses for clubs has been drafted by Bates, Wells & Braithwaite Solicitors.

Clubs in order to gain eligibility for CASC status can adopt these documents in whole or in part.

The following link takes you to the relevant page on CCPR's website containing details of the model constitution, model clauses and some guidance notes for clubs.

Other general guidance and information for clubs is available in a CASC' pack on the CCPR website.

Will the club get rates relief?
In the Pre-Budget Report, the Chancellor announced his intention to double the Corporation Tax exemptions for Community Amateur Sports Clubs (CASCs) in the next Finance Bill. This will mean that clubs with a trading turnover of less than £30,000 and/or property income of less than £20,000 will pay no Corporation Tax on those sources of income.

It is anticipated that these changes will take effect from April 2004 Clubs registered as CASCs in England and Wales will also receive mandatory rates relief of 80 per cent with effect from April 2004 and local councils can increase this relief to 100 per cent at their own discretion

What about VAT?
VAT falls under European Union jurisdiction and is no respecter of charitable or fiscal status. It is a tax on goods and services rather than supplier or receiver, and even charities are liable for VAT (with a few exceptions).

So what exactly are the benefits of charitable status compared with the Inland Revenue scheme?
The 2002 Finance Act introduced an alternative package of tax reliefs via the Inland Revenue. Details of the scheme are now available from their website. However, the range of benefits is not as extensive as those conferred by charitable status.

The table below makes a broad comparison:

Is there a regional helpline?
Key staff in each Sport England region are knowledgeable about the subject and would be happy to discuss issues of concern and, if necessary, take them up with the Charity Commission and/or the Inland Revenue.

However, we cannot act on behalf of the club in negotiating with either body on individual cases.

Find out the contact details for your region