By Charles Randall
29 March 2013
Club cricket has been offered respite from ever-increasing costs by the Government, but the delay in clearing the backlog of Community Amateur Sports Club applications is expected to extend to a year, a development the Club Cricket Conference has described as saddening.
The Chancellor George Osborne announced tax changes in this month's Budget in another laudable attempt to help sports clubs. Such measures are to be included in a new Finance Bill due to be published yesterday (28 March).
Cricket clubs might have noticed that the interpretation of 'amateur' will become less strict. For example, new proposals would allow amateur clubs to make "limited payments" to coaches, players and helpers while still able to register as a Community Amateur Sports Club, better known as CASC. Benefits include an entitlement to charity-related tax breaks and mandatory business rates relief.
Alf Langley, the CCC chairman, welcomed the Chancellor's proposals as an encouraging step forward. "The easing of employee restrictions should help improve the standard of coaching and services a club can offer, and it must be beneficial if the CASC scheme becomes more accessible," he said. "The saddening part of this is the backlog and delay in processing applications. We want more people to play and enjoy cricket at reasonable cost unhindered by red tape."
A number of clubs are having to wait longer than they should. For example, Frocester CC have been fobbed off in their CASC application for many months and have been advised that their wait will extend for another year while new guidelines are prepared. The Gloucestershire club's chairman David Reed sent a letter to the Daily Telegraph, published on March 8, mentioning that Frocester, with 10 teams and a maximum subscription of £60, had applied for CASC registration 12 months ago.
Reed wrote: "We have received four communications from HM Revenue and Customs since, requesting clarification and further information. The changes expected in this month’s Budget will take a further year to interpret, we have been informed in a recent letter. In the meantime, our application has been put 'on hold', and our plans to raise funds to build a much-needed new pavilion, for which we need CASC registration, with its benefits of Gift Aid sponsorship, business rates relief and access to sources of grants, will be delayed a further 12 months."
The Chancellor gave the following detail in his Budget speech: "The Employment Allowance will work by taking the first £2,000 off the employer National Insurance bill of every company. It’s a tax off jobs. It’s worth up to £2,000 to every business in the country. And it will mean that 450,000 small businesses – one third of all employers in the country - will pay no jobs tax at all."
He added: "For the person who’s set up their own business and is thinking about taking on their first employee – a huge barrier will be removed. They can hire someone on £22,000, or four people on the minimum wage, and pay no jobs tax; 98 per cent of the benefit of this new Employment Allowance will go to small and medium enterprises. It will become available in April next year once the legislation is passed. And we’ll also make it available to charities and community sports clubs."
The Government rethink in the Budget would come as small consolation to clubs such as Frocester. Despite best intentions, the CASC scheme has not been widely embraced in 11 years since its introduction in 2002. By the start of March this year sport had benefited by about £135 million in tax relief, but only 6,334 sports clubs -- including about 1,200 cricket -- out of about 40,000 clubs had registered with HM Revenue and Customs.
It has been suggested that a certain rigidity of interpretation and an element of risk could have scared off would-be applicants. For example, many cricket clubs might take on an employee with a blurred status of professional coach and player. There were early concerns that there was a lack of clarity about whether a club would be entitled to tax relief. Charitable status, not CASC, has proved the best route for some clubs.
Professional advice should be sought, and the charity way at the moment is at least quicker. Neville Beckhurst, a sports specialist partner at the Sussex accountancy firm Plummer Parsons, said this week: "Whether to register as a charity or join the CASC scheme depends on what a club is trying to achieve. It might be easier, for example, to get larger funding as a charity because people understand the concept of a charity rather than a CASC."
He added: "The rules are probably more difficult for multi-sport clubs as opposed to cricket only. It can be a case of the clubhouse being a separate entity rather than after cricket. It might be better to register as a charity. That's where the social side comes in. You've got to show that the clubhouse is used for a wider community base."
Tim Lamb, the former ECB chief executive now heading the Sport and Recreation Alliance, was part of the lobby urging improvements to CASC. He said after the Budget he felt encouraged that the Government were planning to adopt a "fairly flexible" approach. "It is a clear indication that the current legislation defining the scheme is not as well as it should be and various outstanding technical issues need to be addressed," he said. "Hopefully by the autumn sports bodies will be able to promote a reinvigorated, clearer and more flexible CASC scheme."