THE grouse shooting season starts today, with landowners and shooting syndicates in the sights of the taxman.
The traditional opening of the season, the Glorious Twelfth, brought claims that demand remains strong despite poor weather affecting bird numbers.
But while shooters head on to moors, willing to spend on average up to 15,000 for a day's driven grouse shooting, investigations are continuing into whether shoots should be VAT-registered.
Douglas Gordon, partner at accountancy firm Saffery Champness, said that the taxman had been going through the records of companies that supply shooting syndicates. He said: "I've seen lots of ways HMRC have tried to investigate this. They pick syndicates up from suppliers of poults (young birds] or they'll look at the books of agents to see who is letting days and who may or may not need to be registered."
Mr Gordon said many shoots originated with a shooting enthusiast inviting a few friends for a day on the moors on the basis that they contributed to the cost of their cartridges.
Potential problems then arose when a shoot needed more birds and started investing in issues such as vermin control and breeding and release pens. Landowners might also create new roadways and provide transport, turning the informal shoot into an expensive operation.
Mr Gordon said: "If you let the right to shoot over your land for no charge to a syndicate of which you are a member, allow guns to pay their contributions to your suppliers, or let the shoot to a shoot operator in return for the provision of a few days' private shooting, you may have a VAT problem. It's the provision of a service, and that's taxable."
Jamie Younger, chairman of the Scottish Land and Estates tax group and partner at Saffery Champness, said that HMRC continued to target cases where they believed shoots had failed to register for VAT or where there was a barter arrangement (with no cash changing hands) between the landowner and shoot operator.
He said: "Scottish Land and Estates continues to recommend that shooting businesses check how they are structured from a VAT perspective to ensure no unwanted tax arises with scope for penalties and interest."
Meanwhile, the cold and wet weather in May and June steadily reduced grouse numbers, with some estates having to either reduce or cancel their grouse shooting programmes.
Areas badly affected include parts of Inverness-shire, upper Findhorn valley and parts of Speyside, as well as areas of Aberdeenshire.
But areas with brighter prospects include the Angus Glens and the Lammermuirs, with some moors still offering days in October.Despite the problems, sporting lets agency CKD Galbraith said that it expected an influx of visitors, with a brace of red grouse expected to reach between 150 and 160 this year.
The grouse industry as a whole is valued at 30 million, and supports around 950 full-time jobs.
It is estimated that more than 6,000 people participate each year in Scottish grouse shooting, with about 20 per cent from Scotland, 51 per cent from the rest of the UK and 28 per cent from North America and the rest of the world.