North Yorkshire Moors Railway General Discussion

We are still in the realm of category error - the fact of a donation is the fundamental divide. And that means that the whole transaction is governed by tax and charity law, not consumer and commercial law. Tax law is very clear that reservation of gift provisions invalidate the tax advantages of a gift, potentially to the detriment of both "donor" and recipient.

As a broader question of public policy, I happen to agree with you that there is a tension here, and that it does require a pragmatic resolution. I do not consider that the proposed resolution is either a) a resolution or b) pragmatic. That is partly because the effect of the delay clause is to make the T&Cs logically incoherent and undermine the general protection that NYMR is seeking in respect of those who do not donate, but more generally because the approach chosen is to explicitly contradict HMRC. Other options (@21B has mentioned several) are equally straightforward and manageable, and sidestep the hazards that are inherent in this approach.

 

So does that mean that if you turn up at Pickering,buy a ticket with gift aid and then the train is cancelled due to a defect, you cannot get a refund? Whereas in the same situation but without gift aid, you can get refunded?

 

That is what the law seems to say, yes.

in practical terms you probably would not handle it that way, but the donor in this instance has no right to a refund.

edit for clarity

 

This is the key distinction - not whether a refund might be made, but whether one would be provided as of right.

 

So then isn't it worth asking NT, RHS etc etc what they do in the rare but not totally unknown event that they have to close their house or garden suddenly and unexpectedly? If they say--- in that scenario, if people don't want to transfer their gift aided on line booking to another day, we voluntarily give a refund and contra the transaction,isn't that problem solved?

 

Precisely my thought. But by being ex gratia and an option for refunding a donation, not exposed to the legal risk

 

National Trust and English Heritage both state if you've booked tickets and the site is closed on the day of your visit, they'll automatically refund the tickets. No mention of what happens if you've added a donation and gift aided your ticket though.

 

Hold on! It was being suggested earlier that a charity could not refund a donation it had previously accepted. What would be the justification for the ex gratia refund? The answer of course is that the charity was unable to provide the service the donor had paid for and had a reasonable expectation of receiving. In which case there would be a statutory right to a refund. It was suggested earlier that you cannot be both a donor and a consumer. The problem is that inconsistent laws means that’s precisely the situation that the conflict creates.

 

In general, charities cannot refund donations. However, trustees do have the ability to determine if and under what circumstances they may refund a donation.

My suggestion is that the charity have a policy granting discretion to offer a refund up to the value of the payment made in certain circumstances, and defining who may make that decision.

As a matter of contract, that would be discretionary rather than operating as of right, and therefore would not require the contortions of granting a contractual right to a refund that tax law prohibits.

It's messy, but it provides a means of dealing with the (low) risk of customers pursuing rights under the Consumer Rights Act that contradict the charity's duties under tax law.

Independently of that, I also suggest some more critical assessment of customer rights be looked at - my own view is that the pre-"Delay Repay" version of T&Cs covered the position entirely adequately, and that embedding performance according to timetable in T&Cs goes beyond what is required for those tickets that are sold, let alone those that are based on the right of admission.

 

My take on whether a Charity should make a Gift Aid Claim on dubious 'gifts' is simply that unless you are absolutely certain that it is a valid claim. If there is any doubt then consider whether the Charity can afford the reputational issues around an HMRC check - which may result in interest and penalties. The Charity should also consider the potential costs in time and professional fees in unpicking records and declarations.

I have submitted a Gift Aid claim for a railway preservation Society this morning. We only have around 50 members but the record keeping and cross checking is both fiddly and time consuming. I'm completely comfortable that our claim is valid and have 'signed' a declaration to say so. In my former professional life I could have lost my job if errors or issues had been found in the claim. I can't imagine the time it would take if HMRC selected someone like the NYMR for Gift Aid compliance check.

I don't think I would have signed a declaration for a Charity following the processes described in this thread. If in doubt, don't claim, and good luck to those who do..

 

The suggestion of discretionary refunds is another way of achieving a pragmatic compromise. What I take issue with is the characterisation of the T and C's as creating a contractual right that would otherwise not exist. That right exists by law regardless of the Terms and Conditions which are actually designed to limit the potential statutory liability.

 

That surely depends on how the dining service operates? For example the GCR's evening diner typically spends 20 minutes (sometimes more) in the platform at Rothley on the return; it's perfectly feasible to get off and leave the station, even if you can't get much further than the nearest post box before you come back to catch the train home. So in that sense, how is it any different than, say, someone who gets off a cruise ship and goes for a shore excursion? Or as I once did, someone who gets off a train at Lancaster, runs into town as fast as they can to buy a new coat, and runs back to catch the onward train? (This is linked to my previous coat going on a solo excursion from Crewe to Liverpool, but that's another story...). The point is, so long as there is a break of journey, it's kind of impossible to argue that you couldn't use the service as some sort of means of transport. Even if you ate a meal while doing so.

EDIT: Taking 'long return journeys with very short breaks' to an even sillier extreme, I once caught an overnight train from Zagreb to Split, got off, bought a sandwich, got back on and went back on the same train from Split to Zagreb. Several hours each way, and I was in Split for about 20 minutes. (However I have no idea about the Croatian tax position...)

 

That is the fundamental point on which we disagree, and where I consider that your interpretation of legislation moved from hard fact to speculation. I follow the logic of your argument, but don't believe it correct. As importantly, I would not want any organisation that I care for to be dragged into litigation on the point.

That applies both from "customer" to "provider", and between charity and HMRC. If I had to choose, I would definitely regard dealing with HMRC as by far the greater risk.

 

Maybe. If the train stops in the way you describe, then possibly VAT isn’t chargeable on the travel portion of the ticket price. I was trying to illustrate the complexity of the situation.

 

I don’t think there is a statutory right of refund to a donor. Quite the reverse.

 

To the consumer yes there are statutory consumer rights.

For donors there are not.

I think it is really that simple, and if we accept that it is that simple then the complexity of the legal framework falls away. Consumers have consumer rights and donors do not. This seems compelling for all the reasons outlined above and because it is the simplest interpretation available.

Where the Ts and Cs are concerned those are fine for a consumer, though why you would offer delay repay on a commercial transaction if you didn’t have to I cannot imagine. There are simpler ways to keep customers happy I feel.

Where donors are concerned the Ts and Cs probably don’t create a right that didn’t exist before so much as don’t apply because they are specifically not permitted by tax law.

The NYMR Ts and Cs ought perhaps to explain that donors are not eligible for a refund, which would manage expectations and avoid a conflict with HMRC. I have a nagging feeling that I have had that explained to me at the entrance to somewhere, but I cannot recall where.

I do agree that none of this makes it easier to manage the visitor well, but it doesn’t make it impossible, just more involved to explain.

 

We can argue whether, in the absence of written Ts&Cs, a donor has an implicit right to a refund. But by actually writing it down, you have turned that implicit right into an explicit one. And given just how black and white the HMRC guidance is that there must be no right of refund, for a Charity Trustee that decision to explicitly go against the guidance seems to me - courageous.

Tom

 

I understood that the GA ticket was in the form of an annual pass. So 364 days to ride the trains. If a train was cancelled on one day the donor has the ability to return again and still obtain value for the ticket?

I hear the conflict between legislation but this is often the case in many areas of law. It does seem to me that the gift aided ticket must come into its own category and can’t be the subject of a refund.
Matt

 

I think that you are being very conservative in your management of water.
500 gallons left!
I've driven my car with less than a gallon left before topping up.

 

There are two different positions. To the end of 2024, Gift Aiding provided the annual pass*, and the conditions were quite clear that any refund brought the validity of that to an end. As of 2025, Gift Aid increases the price paid, offset by vouchers worth (at face value) the same for use in NYMR shops.

* - if we're getting really complex, the annual pass was actually the right to obtain a free ticket on each return visit rather than a true season ticket.