VAT on School Fees

The new Chancellor Rachel Reeves has confirmed that with effect from 1 January 2025, all education services, vocational training & boarding services supplied by a private school, or a connected person, for a charge will be subject to VAT at the standard rate of 20%.

It has also been announced that fees invoiced or paid on or after 29 July 2024 that relate to the school terms after 1 January 2025 will be subject to the standard rate of VAT at the beginning of that term.

School fees paid before 29 July 2024 will follow the VAT treatment in force at the time of the normal tax point for these supplies, where the fee rate for the relevant term has been set and was known at the time of payment.

HMRC will be publishing further guidance for schools about registration for VAT in due course.

If you need further guidance or advice our team would be happy to help. You can contact them by calling 01246 274121 or by emailing consult@mitchellsaccountants.co.uk