Bodies that were previously granted tax exemption under section 235 TCA up to the enactment of Finance (No. 2) Act 2023 will retain the exemption provided that they observe the conditions
Certain bodies established for the sole purpose of the promotion of athletic or amateur games or sports (“approved sporting bodies”) can apply to Revenue for an exemption from Income Tax or Corporation Tax, as appropriate, for so much of their income as is applied for the purpose of promoting the game or sport in question.The definition of “approved body of persons” was amended in section 16 Finance(No. 2) Act 2023, to mirror the definition of sport in the Sport Ireland Act 2015, in order to give greater clarity about what bodies are eligible to apply for tax exemption under section 235 Taxes Consolidation Act 1997 (TCA). The definition of sport includes “competitive sport” and “recreational sport”.
To apply for the exemption the sporting body must:
- be registered for tax with Revenue;
- be legally established, managed and controlled in the State;
- be member controlled and owned;
- have a minimum of three officers or directors, the majority of whom are unrelated and independent;
- the majority of the directors or officers are resident in the State;
- have a constitution that contains Revenue’s standard clauses for unincorporated bodies or incorporated bodies.
The following documentation must be attached:
- the sports body’s latest financial accounts
- a statement of the sports body’s activities, which must include details of: the activities carried out by the sports body; the facilities of the sports body; the properties owned, leased or rented by the body; the coaching and training that is provided; any payments that are made to the coaches and trainers; a copy of the sports body's constitution or governing instrument. If the sports body does not already have this, it must adopt one. Revenue have model constitutions.
Once the sports body has been granted tax exemption, it must:
- remain tax compliant;
- use all income which is the subject of the exemption to promote the athletic or amateur game or sport;
- keep proper records and accounts;
- keep audited accounts, if its annual income is over €250,000;
- notify Revenue’s Charities and Sports Exemption Unit of any change of details
- seek permission from Revenue’s Charities and Sports Exemption Unit for any change in constitution, where required to do so
Without an exemption, a games or sports body, in common with any other organisation:• may be liable to Income Tax or Corporation Tax on any surplus income, and• may be obliged to make annual tax returns.The body is also liable to tax on income that does not qualify for the exemption (that is, income that is not applied for the purpose of promoting the amateur or athletic games or sports).
