Managing subscriptions
Many sports and social clubs run on a subscription model. Unlike organisations that have, say, a customer model, a subscription model of income generation requires repeated and sustained monitoring of who has paid what. Sadly, some club members will try to take advantage by not paying. A financial software package that flags up when a regular payment hasn’t been made can prevent a black hole of revenue loss from emerging – and may even be so simple that it can be used by a club volunteer rather than a paid-for bookkeeper.
A charity – or a business?
These are relatively tough economic times for many community institutions. As a result, sports and social clubs often operate partly as businesses and partly as charities. Perhaps a sports team will rent out its clubhouse for profit, for example, while also using volunteer coaches to deliver services. As a financial manager for such an organisation, making sure that you clearly delineate what activity was commercial and what activity was charitable will pay dividends when it comes to filing tax returns, applying for grants, and more.
Remaining compliant
A third reason why rigorous and scrupulous financial management is so important for a sports and social club is that many larger clubs now have to pay VAT – perhaps due to a growth in membership numbers, a diversification of offerings, or something else. As of April, any VAT-paying sports and social club will need to file its VAT returns using computer-based software with API integration functions under the Making Tax Digital (MTD) scheme – or else they will be non-compliant with tax law, and could face penalties.
If your club doesn’t have takings of over £85,000 and therefore doesn’t pay VAT just yet (which may well be the case for smaller organisations such as bowling teams or Sunday football leagues), you’ve got some breathing space (as the MTD changes coming into effect in April only apply to VAT payers). However, you’ll still need to think about getting hold of the sort of financial management software package that can integrate in the required way with HMRC’s APIs. That’s because all taxpaying individuals and organisations, including corporation taxpayers, will fall under the MTD umbrella at some point in the future.
If you work or volunteer at one of Britain’s many sports and social clubs, you’ll know all too well that it’s a highly responsible job. Investing in a financial record-keeping system to enable top-quality management of club money should therefore be high on the list of things to do.
Find out more about how The Access Group can help transform your finance function.