Readers' forum: Transfer payment

I act as treasurer for a semi-professional football club. Three seasons ago the club sold a player to a professional club for £50 000 plus VAT. The deal said that if the player was resold by his new club for a profit we would receive 20% of the profit made on the deal.

In the event the player was sold recently for £500 000 so we are entitled to receive a payment of £90 000; in other words 20% of the £450 000 profit made by the selling club.

I always assumed that such payments were subject to VAT but after reading Neil Warren’s recent article ‘Donation dilemma’ (Taxation 7 March 2019 page 10) and his reference to the CJEU case of European Commission v Republic of Austria (Case C-51/18) I wonder whether I am right.

In that European case an artist was entitled to...