Charitable events

Nature of an economic activity for input tax purposes

The taxpayer has 12 000 members and aims to support and promote agriculture and allied industries and the role of farmers. It hosts several events each year but only two for which no admission charge is made. These are ‘Countryside Days’ – attended by 6 000 schoolchildren over two days – and ‘Careers in Focus’ – a one-day event attended by 1 500 secondary schoolchildren.

The only income generated from the events was a small commission from caterers and ice cream vendors. The society claimed the level of this income – hundreds of pounds rather than thousands – indicated the events should be classified as business rather than charitable. It said further that it used the events to promote its annual Great Yorkshire Show so was generating increased attendance at that show and therefore increased taxable income.

It was agreed by...