Jayanta Bandyopadhyay 06 July 2026

Club membership entrance fees and taxability

Turf Club membership

New member has to give a one time non refundable membership fee of Rs.25 Lakhs. Does it attract any tax incl GST? Please guide.

Regards,

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Quick Summary

This discussion clarifies the taxability of a non-refundable Rs. 25 Lakhs Turf Club membership entrance fee. It confirms that GST at 18% (or potentially 28% for race clubs) and income tax are applicable. The fee is considered a taxable supply for the right to use club facilities. When bundled with beverage services, SAC code 9996 is recommended as the principal supply, as the primary purpose of the fee is access to the club's recreational and sporting facilities.

4 Replies

kavksatyanarayana (subregistrar/supdt.(retired)) 06 July 2026

Yes. It attracts GST at 18% and income tax also. Consult a local CA/CS for tax and gst services.

T. Kalaiselvan, Advocate (Advocate) 06 July 2026

A non-refundable club membership fee of ₹25 lakhs triggers distinct tax implications under Goods and Services Tax (GST) and Income Tax laws in India.

Under Section 7(1)(aa) of the CGST Act, 2017, any transaction or supply of services between a club and its members for cash, deferred payment, or other valuable consideration is treated as a taxable supply.

Because the ₹25 lakhs is a non-refundable admission or entrance fee, it is treated as a commercial payment made in exchange for the right to use the club’s facilities and services. It falls under SAC Code 9995 (Services furnished by membership organizations) or SAC Code 9996 (Recreational services).

An 18% GST on ₹25 lakhs equals ₹4.5 lakhs, bringing your total out-of-pocket payment to ₹29.5 lakhs unless the ₹25 lakhs was explicitly advertised as "inclusive of taxes."

Jayanta Bandyopadhyay 06 July 2026

many thanks

Turf club and beverage facility.

Which SAC is suggested

We can not use both.

T. Kalaiselvan, Advocate (Advocate) 07 July 2026

When a Turf Club bundles its recreational/sporting facilities with a beverage/restaurant facility under a single non-refundable membership fee, it constitutes a Composite Supply under Section 2(30) of the CGST Act.

In a composite supply, you cannot split the invoice; you must choose one principal SAC code that defines the core intent of the transaction.

You should use SAC Heading 9996 (specifically 999652 or 999659).

The principal supply is the main reason the member is paying ₹25 lakhs is to gain access to the Turf Club, its racing/sporting events, prestige, and recreational facilities. The beverage facility is merely an ancillary (secondary) benefit to enhance the club experience.

Be extremely careful with the exact entry under 9996. While standard club memberships generally attract 18% GST, the GST law has specific high-tax entries regarding race clubs:

28% GST applies to "Services by way of admission to casinos or race clubs or any place having casinos or race clubs."