Section 202B | Restriction on relief for payments to community amateur sports clubs ^F1

(1)Subsection (2) applies if—^F1

(a)one or more qualifying payments are made by a company to a registered club (“the club”) in an accounting period (“the current period”),^F1

(b)the company is wholly owned, or controlled, by the club or by a number of charities which include the club, for all or part of that period, and^F1

(c)inflated member-related expenditure is incurred by the company in that period.^F1

(2)For the purposes of section 189 (relief for qualifying charitable donations), the total amount of those qualifying payments is treated as reduced (but not below nil) by the total amount of that inflated member-related expenditure.^F1

(3)Subsection (4) applies if—^F1

(a)the total amount of that expenditure exceeds the total amount of those payments, and^F1

(b)the company made one or more qualifying payments to the club in an earlier accounting period ending not more than 6 years before the end of the current period.^F1

(4)For the purposes of section 189, the total amount of the qualifying payments made in the earlier accounting period is treated as reduced (but not below nil) by the amount of the excess.^F1

(5)If subsection (3)(b) applies in relation to more than one earlier accounting period—^F1

(a)subsection (4) applies to treat amounts paid in later accounting periods as reduced in priority to amounts paid in earlier ones (until the excess is exhausted or all amounts have been reduced to nil), and^F1

(b)in applying subsection (4) in relation to an accounting period, the reference to the excess is to be read as a reference to so much of it as exceeds the total amount of qualifying payments which, under that subsection, have previously been reduced to nil by the excess.^F1

(6)For the purposes of subsections (3) and (4), a reference to the total amount of qualifying payments made in an earlier accounting period is to the total amount of those payments after—^F1

(a)any reduction under subsection (2), and^F1

(b)any previous reduction under subsection (4).^F1

(7)Such adjustments must be made (whether by way of the making of assessments or otherwise) as may be required in consequence of subsections (4) to (6).^F1

(8)Section 200 (company wholly owned by a charity) applies for the purposes of this section.^F1

(9)For the purposes of this section, the club controls the company if it has the power to secure—^F1

(a)by means of the holding of shares or the possession of voting power in relation to the company or any other company, or^F1

(b)as a result of any powers conferred by the articles of association or other document regulating the company or any other company,^F1

that the affairs of the company are conducted in accordance with the club's wishes.

(10)For the purposes of this section two or more charities (including the club) control the company if, acting together, they have the power to secure, as mentioned in paragraph (a) or (b) of subsection (9), that the affairs of the company are conducted in accordance with the wishes of those charities.^F1

(11)In this section—^F1

“charity” has the same meaning as in Chapter 2,

“qualifying payment” means a qualifying payment for the purposes of Chapter 2, and

“registered club” has the same meaning as in Chapter 2,

and any reference to a member of the club includes a reference to a person connected with a member of the club.