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Edited version of your written advice
Authorisation Number: 1012701724276
Ruling
Subject: Income tax exemption- club established for the encouragement of a game or sport
Question 1
Is the X Club Limited (the "club") exempt from income tax under section 50-1 of the Income Tax Assessment Act 1997 (the "ITAA 1997") as a club established for the encouragement of a game or sport pursuant to item 9.1(c) of section 50-45 of the ITAA 1997?
Answer
Yes.
This ruling applies for the following periods:
Year ending 30 June 2015
Year ending 30 June 2016
Year ending 30 June 2017
Year ending 30 June 2018
Year ending 30 June 2019
Year ending 30 June 2020
Year ending 30 June 2021
Year ending 30 June 2022
Year ending 30 June 2023
Year ending 30 June 2024
The scheme commences on:
1 July 2014
Relevant facts and circumstances
1. The X (the "Club") has applied for a private binding ruling ("PBR") to determine whether it is exempt under section 50-1 of the Income Tax Assessment Act 1997 (ITAA 1997) as a club established for the encouragement of a game or sport pursuant to item 9.1(c) of section 50-45 of the ITAA 1997;
2. The Club was formed in X to promote the game of football in the local community of X;
3. The Club was incorporated into a Company limited by Guarantee on X;
4. The Club participates in the X Premier League football competition, fielding senior sides in the First and Under 21 competitions;
5. The Club's premises are located within X and consist of offices, bar/bistro facilities, and a function/gaming room that contains X poker machines, which is the same number of machines that have been in operation since X;
6. The Club received advice from that the ATO in 1987 that it was exempt from income tax pursuant to paragraph 23(g) of the Income Tax Assessment Act 1936. This decision was confirmed in 1999. The Club received a PBR to this effect again in 2003, which was applicable up to and including the year ended the 30 June 2005;
7. In 2006, the Club received another private ruling up to and including 30 June 2008. Again, in 2009, the Club sought a PBR for the years ended 30 June 2009 through to 30 June 2011;
8. Most recently, in 2012, the Club sought a PBR up to and including 30 June 2014;
9. The Club now seeks a continuation of the above PBRs for the years ending 30 June 2015 to 30 June 2024;
10. The activities of the Club have remained the same since the original PBR was granted in 198X (with the addition of the gaming machines in 199X);
11. The Club has confirmed that there has been no change to either its constitution or its activities since the previous PBR was issued; and
12. The Club has confirmed that its social facilities are unchanged since the last PBR was issued.
Relevant legislative provisions
Section 50-1 of the Income Tax Assessment Act 1997
Section 50-45 of the Income Tax Assessment Act 1997
Reasons for decision
The Commissioner has previously issued a private binding ruling ("PBR") to the Club in the years 1987, 1999, 2003, 2006, 2009 and 2012. In each PBR, it has been confirmed that the club is exempt from income tax under section 50-1 of the ITAA 1997 as a club established for the encouragement of a game or sport pursuant to item 9.1(c) in section 50-45 of the ITAA 1997.
As the circumstances of the Club have not changed, the PBR will be extended for another ten years.
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