VAT on private school fees – HMRC update

At the Autumn Budget 2024, the Chancellor of the Exchequer confirmed that from 1 January 2025, all education, boarding, and vocational training provided for a charge by a private school in the UK will be subject to VAT at the standard rate of 20 per cent. Any fees paid from 29 July 2024 relating to the term starting in January 2025 and onwards will also be subject to VAT under anti-forestalling legislation.  HMRC has also sent a further email on this.

The Government also published a response to its recent technical consultation. A Tax Information and Impacts note and the final draft legislation are also available on the same page.

For schools that may be affected by these changes, HMRC has published the following additional material:

• Check when you need to register for VAT: schools can do this using a new interactive tool. Just click the green ‘Check now’ button,
• In order to use the online VAT registration system, schools will be asked for their Unique Taxpayer Reference (UTR). This can be found on any previous tax returns and other documents from HMRC, and
• HMRC has also updated guidance to reflect final policy design, including clarifications on nurseries, further education providers, and non-maintained special schools.

In the event of any technical queries about registering for, charging, and remitting VAT, HMRC can be contacted by schools, their representative bodies, and tax advisors via the following email address: vatonprivateschoolfees@hmrc.gov.uk.