Gaining sponsorship - can companies claim it back?

durhamwasp

Just wondering if anybody knows about gaining a sponsor for an amateur team, and what the rules are?
Somebody told me recently that if a company sponsors an amateur team/club (for example sunday league football team) they can claim it back in their tax rebate... Anybody confirm this?
We are basically a team that compete in cyclocross and do our own rides for fun. Im thinking of trying to get us some new strips/shorts at a cost of around £300 and wondering if i can use this tax rebate thing as an extra reason for a company to buy us the strips with their name on?
Anyone have any experience in this?

VTech

Yes, they can claim it back. We sponsor several teams/clubs.

durhamwasp

VTech wrote:

Yes, they can claim it back. We sponsor several teams/clubs.

Thanks!

Could you give me a brief overview of how it works? and does the club have to be offically registered in any way? (ie as a sports club through HMRC, or as a Clarion club?)

VTech

ive given to local charities and schools and all i do is give over the money, get a reciept and put it through the books.
ive never had any issue whatsoever.

I used to do the gumball 3000 in the same method but after the second time the taxman shiat a brick and said no !!!!!
I was using that method for marketing though.

durhamwasp

VTech wrote:

ive given to local charities and schools and all i do is give over the money, get a reciept and put it through the books.
ive never had any issue whatsoever.

I used to do the gumball 3000 in the same method but after the second time the taxman shiat a brick and said no !!!!!
I was using that method for marketing though.

Cheers, good to know. Hoping an amateur cycling club/group counts the same as a school or charity...

VTech

I dont think so, I think you will get it under the advertising budget which equates to the same thing.

gazrichards

If you are self employed/limited company you can use sponsorship of sports clubs etc as a marketing expense.
A sports club can be 1 bike rider and they can compete in pretty much anything (bc races, TT, sportive)

I use my company/s to sponsor myself as a 1 man team. I put through all my clothing (cycling kit-it has my company logos on it) I could also put through anything I spend with BC (licence, team registrations). I believe I could put more through such as parts, race entries.

The same could work if you found a company to sponsor your own team, it is a taxable expense for them, that is what is meant by "claiming back".

durhamwasp

Great explanation gazrichards, thanks a lot for that!

DavidJB

so....when are you going to buy me a bike.

rpd_steve

durhamwasp wrote:

Just wondering if anybody knows about gaining a sponsor for an amateur team, and what the rules are?
Somebody told me recently that if a company sponsors an amateur team/club (for example sunday league football team) they can claim it back in their tax rebate... Anybody confirm this?
We are basically a team that compete in cyclocross and do our own rides for fun. Im thinking of trying to get us some new strips/shorts at a cost of around £300 and wondering if i can use this tax rebate thing as an extra reason for a company to buy us the strips with their name on?
Anyone have any experience in this?

I think your 90% there...

If they sponsor you for £1000 lets say, they can not get £1000 off their tax bill. As has been said above, it is the same as them spending £1000 on TV adverts etc. The 'tax rebate' comes in they will now haft to pay corporation tax on £1000 less profit. Depending on the size of the company that will result in them paying £240 or £200 less tax (depending if they are on small profits rate or main rate) than they would.

So to sponsor you £1000 may only 'cost' a company £800 or £760 respectively. You just need to make sure that if you do this with your own company that it is not seen as a 'benefit in kind' - that is where if in the opinion of a tax inspector- the 'sponsorship' is of more benefit to a relation of a director than it is to the company then they view that as tax fraud and you may be subject to a fine and repayment of the tax that was not paid or VAT reclaimed. (been there, done that, had it all out with both VAT and tax man!) lol