The Association of Taxation Technicians (ATT) is urging the Government not to miss a golden opportunity to encourage the funding of grassroots sports.
The Government is consulting on the possibility of corporation tax relief being given for contributions to grassroots sports.1
In its response to the consultation,2 the ATT suggests that consideration should be given to extending the proposed new relief beyond just corporate contributors so that tax relief was similarly available to individual contributors whether self-employed, employed or retired and to contributing partnerships including large professional firms.
Michael Steed, ATT President, said:
“We very much welcome this consultation which could pave the way for a significant increase in private sector funding of grassroots sports. However, we think that the full potential of the concept will only be achieved if the source of the prospective contributions is extended. There is no obvious logic in confining the proposed tax relief to limited companies.
“The tax system could help the Government far more than it may envisage to achieve its goal of getting more people, young and old, actively involved in grassroots sports.
“If we work on the reasonable assumption that contributions that might be made by limited companies under the proposed relief will actually be made because individuals within those companies wish to assist the recipients, it is difficult to see why individuals working in a different business structure should not be able to similarly access any tax relief on comparable contributions.”
In its response, the ATT has called for an extension to the suggested list of eligible purposes to include insurance, water rates, travel, professional costs such as legal advice about leases and any specialist equipment or adaption of facilities for participants who need it. The ATT also suggests that the relief should apply to contributions made in kind as well as those made in cash-form.
In an attempt to identify a simple, straightforward and cost-effective way to administer the proposed relief, the ATT’s response includes the recommendation that consideration could be given to placing a significant part of the responsibility for the system with the various National Governing Bodies that govern the majority of organised sporting activities in the UK. The ATT believes that the idea has the potential to give certainty to prospective contributors, simplify fund-raising for the grassroots clubs and give HMRC assurance that the relief was being operated as intended.
Notes for editors
- The Treasury’s consultation document can be read here: https://www.gov.uk/government/consultations/corporate-contributions-to-grassroots-sports
- ATT’s submission can be read here.