Case Alert

CJEU rules against UK in VAT on sports services case

The supply of services that are closely related to sport are mandatorily exempt from VAT if those services are provided by a non-profit making body. However, Member States may make the granting of the exemption subject to a number of conditions including a condition that the exemption must not be likely to cause distortion of competition to the disadvantage of commercial entities who are required to charge and account for VAT.

UK VAT law makes a distinction between non-profit making bodies (such as a charity) and bodies governed by public law. The taxpayer in this case was a Local Authority which was required to account for VAT on its supply of sports services.

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