This article explains how VAT applies to payment processing fees in Spond and whether clubs can request a VAT invoice from Stripe.
How the fees work
When a club collects payments through Spond, Stripe charges a processing fee of 2.5% plus 20p per transaction.
At first glance, this may seem like a standard UK payment processing arrangement. However, the entity involved is not a UK company, which affects how VAT is handled.
How Spond’s structure affects VAT
Payments for UK clubs are processed through Spond’s Norwegian parent company. As a result, the arrangement sits outside the UK VAT system. Spond is not registered for UK VAT, and its contract with Stripe is governed by Norwegian and EU VAT rules rather than UK VAT rules.
Stripe’s European operations invoice Spond under those rules. Any VAT documentation created as part of that relationship belongs to Spond, not to individual UK clubs.
Why most clubs do not need to account for VAT
When a service is supplied by a non UK entity to a UK recipient, the reverse charge would normally mean that the recipient accounts for VAT themselves. However, this only applies where the recipient is VAT registered.
Most Spond clubs are not VAT registered. They are typically unincorporated associations, community groups or small charities operating below the £90,000 VAT registration threshold.
For those clubs, no UK VAT applies, no reverse charge arises, and there is nothing to account for or reclaim.
Can clubs get a VAT invoice from Stripe?
No, not directly.
Stripe issues VAT documentation only to its direct contractual counterparty, which in this case is Spond. Clubs do not have a direct relationship with Stripe, so they cannot request VAT documentation from Stripe themselves.
In practice, the relationship works as follows:
Stripe and Spond
Stripe invoices Spond under EU and Norwegian VAT rules.
Spond and the club
The club’s relationship is with Spond, not Stripe.
The club and the UK VAT system
This is only relevant if the club is VAT registered.
What VAT registered clubs should do
If a club is VAT registered and wants to reclaim input tax on payment processing fees, it should contact Spond directly and request supporting documentation.
Spond would need to provide a suitable document showing the relevant fee information in a format that meets HMRC requirements.
Whether this is currently available should be confirmed with Spond’s team.