In its August 2026 newsletter for Community Amateur Sports Clubs, HMRC repeated a rule most club committees have never read closely. A club's combined non-member trading and property income must not exceed £100,000 in an accounting period, and clubs that exceed it should tell HMRC, because it may affect their CASC status.
Clubs rarely get there through one big event. They drift there through the social section, whose members drink at the bar all year and, in most constitutions, cannot vote. Our free tracker for CASC treasurers keeps the monthly figures against each limit. This is why the social members are the part to watch.
A member is somebody with a vote
For CASC purposes, selling to a member is not trading at all. HMRC's guidance on taxable income says a club is not trading when it sells goods or services to voting members. The word that matters is voting.
Most sports clubs have several kinds of membership. There are playing members, juniors, vice presidents, life members, and a social or associate section for people who want the clubhouse without the sport. The constitution usually gives the vote at general meetings to playing and senior members only. Everybody else uses the bar, and nobody thinks of them as anything other than members, because they pay a subscription and carry a card.
HMRC does not look at the card. If a social member cannot vote, the club is trading with a non-member every time they buy a drink, and their subscription is non-member income too. In the club's books both usually sit in the same columns as the voting members' spend, so the treasurer has no easy way to see how much of the bar is member income and how much is not.
The same newsletter reminded clubs that governing documents should stay current and reflect how the club actually operates. The first job for a treasurer is to read the membership section of the constitution and write down which categories can vote.
Takings, not profit
The £100,000 is measured on gross receipts, excluding VAT. It is not the bar profit and it is not the figure at the bottom of the accounts.
This is where most committees go wrong, because a sports club's annual accounts usually show the bar as a trading account. Sales at the top, purchases and stock movement underneath, and a bar profit carried through to the income and expenditure account. A committee that reads a bar profit of £24,000 thinks of the bar as a £24,000 business. For the income condition it is a £60,000 business if that is what went through the till, and the part that counts is whatever share of the £60,000 came from non-members.
Property income works the same way. The gross hire fees count, not what is left after the cleaner and the heating have been paid.
VAT is the one deduction allowed. A club registered for VAT uses takings net of VAT, which is the figure the till report and the VAT return already show. A club below the VAT threshold uses what it took. Either way the figure to watch is the turnover line, and it needs keeping month by month, because the accounts arrive months after the year they describe and by then the limit has either been passed or it has not.
The arithmetic most committees never do
Take a cricket or rugby club with 200 social members who cannot vote. If each of them spends £8 a week at the bar, that is £1,600 a week and £83,200 a year of non-member trading. Their subscriptions sit on top. At £40 each, the 200 of them add another £8,000.
Now add the property income. The pavilion is hired for birthday parties, wakes and christenings, a nursery rents a room in the week, and the car park is let to the business next door. At £20,000 a year between them, the club is at £111,200 and over the limit.
The hire income counts even when the person hiring the hall is a full voting member. The income condition leaves out trading with members, but property income is included in full whoever pays it. A member's daughter's wedding reception in the clubhouse counts exactly as a stranger's would.
Visitors add to it as well. Away teams, spectators, parents watching junior training and guests at the presentation night are all non-members, and what they spend at the bar and the tea hut counts.
None of these figures is unusual for a club with a busy clubhouse. What is unusual is anybody adding them up during the year, rather than finding out afterwards from the accountant.
The two tax limits underneath
The £100,000 is the condition for staying registered. Underneath it are two lower limits that decide whether the club pays corporation tax.
The first is on non-member trading. Under section 662 of the Corporation Tax Act 2010, the trading profits are exempt only if turnover is £50,000 or less for a twelve month period. The second, in section 663, is £30,000 of property income. Both are reduced proportionately for a shorter accounting period, so a club with a six month period has limits of £25,000 and £15,000.
Going over either limit loses the exemption for all of that income, including the part below the limit. HMRC's own example is a club with £54,000 of trading turnover and £8,000 of profit, which pays tax on the whole £8,000. The club in the last section, with £91,200 of non-member trading, would be taxed on all of its profit from non-member trading.
The August newsletter set out when a return is needed. If either limit is exceeded and the club makes a profit, it must submit a Corporation Tax return, and a return is still required even if HMRC has not issued a notice to file. A club that has never filed one has no reminder coming, so it falls to the treasurer to spot that the limit has gone and that a return is due.
What HMRC is doing about it
Newsletter 4 came out in August 2026. Alongside the £100,000 reminder and the filing rule, it asked clubs to tell HMRC when club officials change, to keep governing documents current and in line with how the club operates, and to keep documentary evidence to support club decisions and changes.
It also announced four online workshops, held between 25 August and 3 September, for clubs, volunteers, committee members, advisers and representative bodies. HMRC said it wanted to gather evidence on different aspects of the scheme and how it operates in practice.
We do not know what HMRC will do with what it heard, and it would be guesswork to say. What the newsletter does show is where HMRC is looking. The income limits, the governing documents and the list of officials are the parts of a CASC registration that can be checked from outside the club, and they are what the newsletter was about.
For a treasurer, the sensible response is the same whatever comes next. Know which members can vote. Know the non-member trading and property figures month by month. Keep the evidence where it can be found if HMRC asks for it. A club that can show its figures, even figures close to the limit, is in a far better position than one that has to rebuild them from bank statements after a letter arrives.
The trading subsidiary, and watching it monthly
The newsletter's own suggestion is that clubs expecting to approach the limits may wish to consider operating certain activities through a subsidiary company. That is a limited company owned by the club which runs the trading the club itself cannot, usually the non-member bar, functions and events. HMRC's guidance says income a trading subsidiary earns does not count towards the club's threshold.
The subsidiary pays corporation tax on its profits like any other company, and it can pass profits up to the club by Gift Aid, which reduces its taxable profit. It needs its own accounts, bank account and tax returns, and its dealings with the club have to be on proper terms. It should be set up with an accountant, and that takes time, which is why the decision needs making well before the limit is reached rather than in the month the club goes over.
That is the case for watching the figures monthly. Our free tracker for CASC treasurers takes each month's takings in five columns, separating voting members from everyone else, and keeps a running total against the £100,000, the £50,000 and the £30,000, reduced pro rata for a short period. It projects the year-end position, names the month the club would go over on current pace, and prints a one-page report for the committee or the accountant. Nothing is uploaded.
Questions
Do social members count as members for CASC purposes?
Only if they can vote at general meetings. HMRC treats a club as not trading when it sells to voting members, so social or associate members without a vote are non-members. Their bar spend and their subscriptions count towards the £100,000 and £50,000 limits.
Is the CASC £100,000 limit on profit or turnover?
Turnover. It is gross receipts from non-member trading plus all property income, excluding VAT, before any costs are taken off.
Does a club have to tell HMRC if it goes over £100,000?
HMRC's August 2026 newsletter says clubs that exceed the limit should notify HMRC, because it may affect their CASC status.
What is a trading subsidiary for a sports club?
A limited company owned by the club that runs trading such as the non-member bar. Its income does not count towards the club's limit. It pays corporation tax on its profits but can pass them to the club by Gift Aid.
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