In Abbotsley Limited & Others v HMRC [2018] UKUT 0191, the Upper Tribunal (UT) found that the CONGU handicap system was essential to golf, such that the fees paid towards its administration are exempt.

  • Golf courses were owned by the following appellants:
    • Abbotsley, a limited company
    • Cambridge Meridian, a partnership
  • The third appellant Cromwell, an unincorporated association, is a members’ club and the members play on a course owned by Abbotsley.
  • Members of the golf clubs affiliate to that club and pay affiliation fees.
  • The clubs may pay affiliation fees to affiliate with a county union or association.
  • The county unions affiliate to the national union.
  • The national union is a member of the Council of National Golf Unions (CONGU).
  • The various unions and associations are non-profit making.
  • The clubs often choose to pay the affiliation fees to attract members.
  • The principal service provided by the unions and associations in return for the payments is the management of the CONGU handicapping system. This system is only available to affiliated clubs.
  • The appellants argued that the fees charged could not be exempt:
    • The exemption only applied to non-profit making businesses.
    • To be within the exemption the services must be essential to the sport and the services provided were not.

The UT agreed with the First-Tier Tribunal that the affiliation fees charged to the golf clubs were exempt:

  • EU case law does not differentiate between profit making and non-profit making organisations in respect of the exemption. As most businesses are profit making, it would have done so had it meant to restrict the exemption to non-profit making organisations.
  • The main service received was the management of the CONGU handicap system. Without the CONGU handicap it would be impossible to participate in golf of the same value.
  • The handicap allows people of all abilities to compete in serious golf competitions.
  • The handicapping system is therefore essential to the sport of golf. This means the services provided for the affiliation fee were essential to sport and exempt.

Link to case: Abbotsley Limited & Others v HMRC [2018] UKUT 0191



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