Unincorporated Association - Business Rates

redcupra

Hi
I am the treasurer for a radio control car club. Our members pay an annual membership fee and a race entry fee. We have access to an outdoor track which we pay to use.

We do not make a profit all monies go back into the club.

The local council is trying to pursue us for the payment of business rates. I have tried to explain the situation that we are a small club, not a business but they are now trying to push this onto me and suggesting I'm a sole trader which is rediculous.

Has anyone got any advice?

Thanks

penners324

Rates relates to a premises. Is this what they mean?

Is the club formally constituted and a bank account in its own name?

redcupra

penners324 said:

Rates relates to a premises. Is this what they mean?

Is the club formally constituted and a bank account in its own name?

Yes, this is what they mean. We are in the progress (within the next week of approving the constitution) we dont have a bank account in our name. 

DullGreyGuy

redcupra said:

I am the treasurer for a radio control car club. Our members pay an annual membership fee and a race entry fee. We have access to an outdoor track which we pay to use.

We do not make a profit all monies go back into the club.

The local council is trying to pursue us for the payment of business rates. I have tried to explain the situation that we are a small club, not a business but they are now trying to push this onto me and suggesting I'm a sole trader which is rediculous.

Has anyone got any advice?

You say you "have access to" the track? Do you exclusively hire it 24/7 or just rent it for 2 hours a week?

Property is domestic, non-domestic or agricultural, domestic pay council tax, the others pay business rates irrespective of if it's actually run as a business, hobby, non-profit association etc. 

What is the rateable value of the property? If it's less than £15k you can apply for small business relief, again it doesn't matter that you're not actually a business. 

Robin9

@redcupra   Can you clarify  please -  do you actually own or lease a premises ?    If so how much are the business rates ?

tacpot12

It sounds like the club is an unincorporated association - see Unincorporated associations - GOV.UK

I'm Treasurer for a sailing club and we get an exemption for business rates because we are registered as a Community Amateur Sports Association (CASC). This also allows us to use Gift Aid for donations and exempts us from Corporation Tax as well. Unfortunately Radio-controlled Cars aren't on the list of sports that you can register as a CASC for, but if there is an association for your hobby, you could try talking to them to see if they have any plans to seek recognition. 

However, this won't help you in the short term. 

I would tell the  council that you are an  unincorporated association and to the extent you are liable for business rates on your premises (which you might be renting or leasing), you are the person liable to pay the rates. If this liability feels too much, you may need to talk to your members about incorporating, i.e. becoming a limited company. (My sailing club is a company that it limited by guarantee). 

daveyjp

The Council will bill whoever they see as being in 'beneficial occupation', whether this be an individual, ltd company, charity, public sector etc

To avoid the rates bill you need to demonstrate you are eligible for relief and this can be done through the structure of the organisation.  I'm also a member of a club which is a CASC and it saves us about £40k a year in business rates.

penners324

Which premises are the council claiming you owe rates on?

Bookworm105

you need to answer the question

@redcupra   Can you clarify  please -  do you actually own or lease a premises ?    

the fact that you are a club ("unincorporated body") where no individual person takes money out of it does not magically exempt you from tax compliance.
The club is a "business". It is neither a registered charity, nor a CASC, but its activities are those of a "small business". The "not for profit" aspect is irrelevant in that context.

The issues are:
- business rates are payable by the premises owner / lessee
- business rates relief is 100% up to an annual threshold  

so 
- who owns the premises?
- how much is the rateable value?
Business rates relief: Small business rate relief - GOV.UK

lincroft1710

DullGreyGuy said:

redcupra said:

I am the treasurer for a radio control car club. Our members pay an annual membership fee and a race entry fee. We have access to an outdoor track which we pay to use.

We do not make a profit all monies go back into the club.

The local council is trying to pursue us for the payment of business rates. I have tried to explain the situation that we are a small club, not a business but they are now trying to push this onto me and suggesting I'm a sole trader which is rediculous.

Has anyone got any advice?

Property is domestic, non-domestic or agricultural, domestic pay council tax, the others pay business rates irrespective of if it's actually run as a business, hobby, non-profit association etc. 

. 

Property used for agricultural purposes is exempt from rating