Sponsorship Income is TAXABLE income

It is important for all sporting organisations to be aware that sponsorship income is taxable income and therefore should be declared to the tax authorities.

Sponsorship Income is TAXABLE income

I delivered the final business workshop of three for Essex Lawn Tennis Association in Southend last night for their clubs and coaches and it was certainly as lively and engaging as the other workshops had been.

There were some great questions from the delegates and the thorny subject of sponsorship income was raised.    It is important for all sporting organisations to be aware that sponsorship income is taxable income and therefore should be declared to the tax authorities.    It will be taxable if your organisation provides the sponsor with any appreciable benefits, including name on kit, billboards, advertising space and naming rights.

Clubs should consider becoming a CASC (Community Amateur Sports Club) if they are benefitting from significant sponsorship income.   A CASC can earn up to £30,000 through its trading activities tax free.    Please note that if the CASC earns more than the £30,000, all of the income will be taxable, i.e. the first £30,000 will NOT be tax free.

Proposed changes to the CASC scheme this year are likely to see the £30,000 limit raised to £50,000. more good news for clubs who are registered.    Please ensure your treasurer/accountant monitors sponsorship income so that it doesn’t come back to bite you as and when you get a visit from HMRC.

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