A community amateur sports club (CASC) is not a person under tax law, so it cannot be charged a tax penalty under section 98A TMA 1970. 

In an article in this month’s the CIOT’s Tax Adviser magazine, Peter Ashby tells the tale of a cricketing CASC that was incorrectly hounded for tax penalties by HMRC.

After a PAYE audit HMRC considered that the clubs player coaches were employees. Peter pointed out that as both players were overseas residents and Commonwealth citizens their earnings were covered by their UK personal allowances. HMRC’s tax assessment was reduced to “nil”. There was however a £1,278 NICs liability and the club had mistakenly failed to file P35s and P11D for the two players for two years.

HMRC charged a 100% penalty for the NICs.

The adviser appealed requesting that HMRC use its powers to reduce the penalty under s102 TMA 1970. Pointing out that it was unreasonably high for a CASC for what was only a minor and unknown offence (and even HMRC had got the tax aspect wrong). Also pointing out that tax evaders under the Liechtenstein Disclosure Facility pay only 20% penalties.

HMRC refused to cave in, and the case headed to the First Tier Tribunal. Three days before the hearing HMRC pulled out, admitting that the CASC was not a legal person. No penalties were due.


As Peter observed, whilst a club, as a body of persons can be an employer for PAYE return purposes (s15), it is not “a person” for section 98A. This is a possible loophole.

Back to:  Nichola's SME Tax Update 17 June 2015