OK, perhaps not the most interesting subject but am I alone in feeling uneasy that the TWS will now be paying less (or virtually no) corporation tax?
The Annual Review and Financial Statements make very interesting reading. https://www.thewinesociety.com/annual.
The financial performance of the Society has been nothing short of spectacular but I was drawn to the comments around tax.
Ken Brown’s comments include this:-
“As the result of this review, which included lengthy correspondence with HMRC, and a detailed analysis of HMRC guidelines The Society has concluded that it should prepare its accounts on the basis that it carries on a mutual trade with its members for tax purposes. As such the surplus arising from the mutual trade will fall outside of the scope of UK corporation tax”
The impact of this is that despite profits for the latest trading year increasing nearly fourfold to £7.5m, TWS appears to be actually due £11k from HMRC. It paid £399k the previous year.
This is clearly within the rules but is it the most socially responsible position? This at a time that the UK needs strong levels of tax receipts to fund the huge amounts of expenditure and debt taken on board to cope with the Covid costs. I would be interested to hear the views of other members.
I suppose if you take the opposite view to mine, one would ask why this change in filing was not applied beforehand and has the Society been over paying tax?