Harleyford Golf Club v HMRC

In Harleyford Golf Club v HMRC (No 2) (TC01476 – 24 October) a limited company (H) was incorporated to operate a golf club. It required most members (other than junior members or social members) to purchase debentures in it. Customs issued a ruling that the sale of the debentures constituted a taxable supply of services. H appealed contending that the sales should be treated as exempt from VAT under VATA 1994 Sch 9 Group 5 Item 6. The VAT Tribunal rejected this contention and dismissed the appeal holding that the act of purchasing a debenture represented ‘non-monetary consideration for the supply of services namely the grant of membership rights’ (VAT Decision 14466). HMRC subsequently accepted that with effect from August 2001 H should be treated as making a single exempt supply. They repaid output tax from 2003 to 2006 but rejected...