Don't get caught out by HMRC changes

With HMRC’s efforts to reduce the tax gap and the increase in interest charged on unpaid tax from April 2025, make sure you don’t get caught out. Whilst racing is a passion for owners, when VAT-registered, HMRC considers it to be a business operating under the Scheme.

What does this mean for VAT-registered ownership entities?

Qualification
If you are setting up a new VAT registration as a sole owner, partnership, syndicate, company, or club, the first step is to complete a D Form and submit it to the BHA VAT Desk for authorisation. Without this declaration from the BHA, the entity will not qualify under the Racehorse Owner’s Scheme from HMRC’s perspective.

Ownership
With most first VAT submissions selected for review by HMRC, and a proportion of established VAT registrations chosen for random checks, entities must ensure that sales and purchase invoices match the details held by HMRC. This includes the entity’s trading name, and, in the case of partnerships and syndicates, the names of the partners and members involved.

Taxable Supplies
When registered under the Scheme, as with any business, there will be taxable supplies to declare to HMRC. For the purposes of the Scheme, taxable supplies include appearance and prize money, sponsorship income, and the sale of a racehorse. To ensure the entity receives VAT on prize money, the VAT certificate should be lodged with the BHA VAT Desk once the VAT number has been issued.

The ROA VAT Solution can take care of all the above, including new VAT registration, first submission checks and beyond. We reclaimed over £1.7m for our clients from January - March 2025. So, if you need advice, help, or simply want someone else to manage your racing VAT on your behalf call 01183 385 685 or contact [email protected] to speak with Davina, Glen, or Rebecca.