Clean bowled – Eynsham Cricket Club’s appeal dismissed by the Court of Appeal

The Court of Appeal has today handed down its judgment in Eynsham Cricket Club v The Commissioners for Her Majesty’s Revenue & Customs [2021] EWCA Civ 225, a judgment that will be of great interest both to those in the charity sector, and to Community Amateur Sports Clubs (“CASCs”).  At the heart of the case was the issue of whether since the Finance Act 2010 brought into law a new definition of a charity for tax purposes, the deeming provision in s.6 Charities Act 2011 to the effect that a CASC cannot be a charity ceased to apply for tax purposes.

The case was brought following HMRC’s ruling that the Club’s construction of a new cricket pavilion could not be zero-rated for VAT because, as a CASC, it could not benefit from the VAT relief provided specifically for charities.

Simler, LJ. giving the judgment of the Court of Appeal (with which Singh and Henderson LJJ. Agreed), concluded at [53] – [56] that as a matter of statutory construction s.6 Charities Act 2011 stands as a statement of the general law of England and Wales for all purposes, unless and until expressly disapplied and that in the absence of any such disapplication a CASC cannot be a charity.  At [58] Simler, LJ. concluded that this was consistent with the broader legislative context, history and purpose of the Acts.

The Court of Appeal also rejected the Club’s claim that denial of zero-rating would breach the principles of equal treatment/fiscal neutrality because (i) the comparator put forward by the Club was not in a similar circumstance, and (ii) any difference in treatment was objectively justified in any event by the different regimes that they had chosen to operate in.

Howard Watkinson was instructed in the case by HMRC.

Howard acts for both HMRC, and taxpayers, in matters concerning complex points of tax law, in both the Tax Tribunals, and the Civil and Criminal Courts.