TC09534 - [2025] UKFTT 00594 (TC)

Fecha: 24-Abr-2025

Rushby

Rushby

68.

Rushby is a partnership which provides dance and fitness studio dance classes. It offers a large range of different classes both in groups and on a one-to-one basis.

69.

Agreement has been reached between Rushby and HMRC as to how most of the classes should be categorised (exempt or standard-rated) for VAT purposes and we need say nothing about those classes. There are however five categories of class offered by Rushby which remain in dispute. These are mostly dance exercise class and are as follows:

(1)

Kettlercise – this is a form of exercise using kettlebells. In the schedule of classes attached to Mr Rashleigh’s second witness statement, the word “kettlercise” has the registered trademark symbol (®) against it. On the basis of this, we accept Mr Marks’ submission (not challenged by Mr Chapman) that kettlercise is a registered brand name.

Kettlercise is described in a letter from Rushby’s agent to HMRC as “an activity which promotes fitness, balance, coordination and other related attributes, which in total permit the student to perform a more active role in life and to benefit from the health-giving properties accruing from the combination of increased self-confidence and personal mental and physical development”.

(2)

Kettlercise genesis – there is no explanation as to the difference between this and kettlercise and no distinction was drawn between the two by Mr Chapman. We infer therefore that it is similar in its nature and objective to kettlercise.

(3)

Latin in Line – again, no explanation has been given as to what this involves. Mr Chapman speculated that it involved some form of exercise based on Latin music and/or dance movements.

However, we note that, in an agreed schedule of the various different classes offered by Rushby, the justification given for this being exempt from VAT is simply the word “ballroom” which suggests that it may be a dance class rather than a dance exercise class given that the justification for other fitness classes is specifically shown as exercise.

Given this evidence, we find on the balance of probabilities that Latin in line falls into the category of dance classes rather than exercise classes.

(4)

Summer workout – again, this is described as fitness. In the letter from Rushby’s agent to HMRC, it is described as “aerobic dance classes designed to teach dance skills and also to improve fitness through dance”.

(5)

Ballet active – again, we have no explanation as to what this involves. In the agreed schedule the justification given for this being exempt from VAT is that HMRC have accepted that ballet is exempt. Once more, we have no further information as to what these classes involve although, given the name, it can be inferred that there is an element of fitness/exercise rather than just ballet as a dance form.

70.

HMRC issued its registration decision on 26 July 2016, registering Rushby for VAT with effect from 1 January 2012.

71.

On 6 February 2019, HMRC issued a VAT assessment for £21,944 for the period 1 January 2012 to 30 November 2014. On 12 February 2019, HMRC assessed a penalty of £4,398.80.

72.

As we have already noted, neither of these assessments have been appealed. HMRC however accept that, having agreed that a number of the classes do fall within the exemption for private tuition, these decisions will need to be revisited irrespective of our decision in relation to the classes which remain in dispute.

73.

The classes mentioned above are all group classes. As we have mentioned, Rushby also offers one-to-one classes. We were told that HMRC and Rushby have agreed that the treatment of the one-to-one classes should follow the treatment of the group classes. This will be done based on the specific activity for each one-to-one class where this can be ascertained. If the precise nature of any of the one-to-one classes cannot be ascertained, the supplies will be split in proportion to the exempt and standard-rated supplies resulting from the group classes. We do not therefore need to make any separate determination as to whether the one-to-one classes are exempt from VAT.