The above brief provides an update on HMRC’s view on unjust enrichment as announced in Brief 25 of 2014 which followed the CJEU judgment in Bridport & West Dorset Golf Club.

HMRC announced that it was considering whether clubs would be unjustly enriched if claims were refunded in full. This brief reports the conclusion of that work.

HMRC’s review has concluded that if claims were credited in full some clubs would be unjustly enriched by 50 per cent and others by 67 per cent. Some clubs disagreed with the conclusions of the review and with HMRC’s position that corporate days and supplies to tour operators are standard rated, as outlined in VAT Information Sheet 01/15 (claims by non-profit making members’ sports clubs for overpaid VAT on supplies of sporting services made to non-members). These issues have recently been heard by the First Tier Tribunal.

Although the question of unjust enrichment is still before the courts, HMRC has decided to pay or credit, subject to conditions, 50 per cent or 33 per cent (depending on the golf club) of the value of valid claims ahead of any court decision. HMRC will credit a claimant’s VAT account if there is an outstanding debt.

The amount repaid or credited to each claimant will depend on the level of green fee charges. Where a golf club charges any green fee now or during the claim period, of over £100 per person for a round of golf, at any time of the year, HMRC will repay or credit 33 per cent of its compliant claim, all other claimants will receive 50 per cent. HMRC considers the level of green fees is representative of a club’s ability to pass on the VAT cost to its customers.

The Brief also contains information on next steps to enable clubs to seek interim repayment/credit.