Charities Bill [HL]

The Government introduced the community amateur sports scheme (CASC) as an alternative to charitable status for amateur sports clubs in 2002. As the noble Lord, Lord   Phillips of Sudbury, knows, it gives qualifying clubs many but not all of the tax reliefs that charities enjoy from both direct taxation and property rates. For those reasons, it has proved to be a popular and successful scheme. The provisions in subsections (4) and (5) of Clause   (5) of the Bill are to ensure that a qualifying club can choose to be a registered CASC or a registered charity, but cannot do both at the same time. If a CASC did want to become a charity, it could create a new club in charitable form, pass all the CASC’s assets to the charity, and then wind up the CASC. During the previous sessions, as the noble Lord rightly recalled, we did offered to consider the proposal he put forward as its intentions are to provide for a simpler process for the transition of a CASC into a charity. Having thought about it some more, we have concluded that although the amendment achieves a perhaps slightly smoother passage from CASC to charity, there is a risk that the deemed disposal by the CASC of its assets during the process would give rise to a chargeable gain   that might not be exempt under the charity exemptions. For that reason, we think it is wisest, though we can see merits in the proposal, to resist the amendment.