VAT on private school fees

The Government has announced its intention to apply 20 per cent VAT to private school fees across the UK from January.

Draft VAT legislation has been released and a public consultation has opened until 15 September. Full details can be found here: VAT on Private School Fees & Removing the Charitable Rates Relief for Private Schools – GOV.UK (www.gov.uk)

We know some Army families have concerns about how this change might affect their children’s education.  

We are raising your questions with the Ministry of Defence (MOD), but at this point – while the legislation is under consultation – there is limited information available. We are stressing the importance of urgent answers for Service personnel and their families, particularly those overseas or who have an overseas posting coming up, and those with children in critical exam years.

We have an extensive enquiries database, which is fully data protection compliant, on which we will record any information you choose to share with us. We will draw on this data for AFF’s submission to the consultation.

Will Armed Forces families be exempt from paying VAT?

The draft policy only notes that the Government will closely monitor the impact for those Service personnel who claim Continuity of Education Allowance (CEA) and states that the upcoming spending review is the right time to consider any changes to the scheme.

My children are at a state boarding school will they be exempt?

The draft policy notes that education and boarding provided by the state will be exempt from VAT.

2.12 Education and boarding provided by state schools (including academies) are not affected by this policy change, meaning they will continue to be exempt from VAT. This reflects the fact that state schools and academies will continue to be “eligible bodies.”

I am claiming Continuity of Education Allowance, will this increase?

Continuity of Education Allowance (CEA) is reviewed annually by the MOD, normally around 1 August each year. When they calculate the rate, they look at the average fee increases across a percentage of schools, to help determine how much CEA will increase that year. We do not know if the MOD will do an additional or earlier recalculation; we are encouraging them to do so.   

How much extra will I have to pay?

Schools may approach the application of VAT in different ways. The policy is still draft legislation and open to consultation, so schools may not be able to answer all your questions, but speaking to your school finance department to find out how they plan to address this is a first step.  

What is AFF doing?

We have been raising your concerns with the MOD, and working with organisations such as the Independent Schools Council, the Boarding Schools Association and the other families federations, highlighting the importance of a stable educational experience for Service children, and the role independent schools can play in this. AFF will be making a formal a submission to the consultation about the impact this draft policy will have on some Army families. If you would like to contact us and share your evidence, please email moneysupport@aff.org.uk. Your evidence will help us to build a robust consultation response and aid in our continuing discussions with stakeholders and the Government.


POSTED ON 6 AUGUST 2024

I feel more confident following the information you've given me

    Comments

    It’s really simple. I use independent boarding schools BECAUSE I’m a government employee. If the government want to increase the fees I expect them to meet that cost or exempt me from it. If they don’t, I will pursue private employment to secure a considerably better private salary in order to deliver ongoing continuity for my child’s education now I have committed to this delivery model.

    The impact of repeated school moves on my daughter was clear in both attainment, progress and social development. It has take 3 years of independent schooling to catch up (noting that still puts her behind where she would have been from a stable foundation.

    The guilt I feel for that impact of massive.

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