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HMRC internal manual

Business Income Manual

Meaning of trade: mutual trading and members clubs: allocation of income: income from contributors (members)

Income from members falls into a number of broad categories:

  • Subscriptions - for ordinary members this forms part of the non-taxable income arising from the club’s mutual activities; for temporary members or junior/honorary members, whose subscriptions subsidise those of ordinary members and whose rights are not equivalent to full members, this is taxable as trading income - see BIM24220, BIM24225 and BIM24240.
  • From non-trading activities - this is not taxable as trading income. But remember that non-trading items are taxable in the normal way, for example rental income will be taxed under the property income rules.
  • From trading activities where the conditions in BIM24020 are satisfied, this is not taxable on the basis that it derives from a mutual trade.