VAT on private school fees

VAT on private school fees: have you considered the potential VAT benefits?

The impending introduction of VAT on private school fees has caused a great deal of concern among private educational institutions.

The thought of the increased financial burden on both schools and their pupils is understandably daunting. However, amidst these concerns, it’s essential to consider the potential VAT benefits that this new regulation may bring.

The implementation of VAT on private school fees transforms certain activities within the schools into ‘taxable’ activities. This transformation is not just a challenge but also an opportunity.

Previously, VAT on many of the costs incurred by private schools was irrecoverable which added to the financial strain. With the introduction of VAT, a significant VAT benefit is that schools will be able to recover VAT on certain expenses that were previously a sunk cost.

For instance, expenditure relating to maintenance, capital projects, and other operational costs that attract VAT can now be recovered, provided they are linked to taxable activities.

This recovery can offset the increased burden of VAT on school fees to some extent. It is crucial for schools to review their expenses and identify areas where VAT recovery is possible.

We are currently working closely with numerous schools and private schools to navigate this complex VAT landscape and secure VAT recovery in this sector.  By engaging our services these institutions are identifying and reclaiming historic VAT, which can significantly soften the impact of the forthcoming increase in fees. By reviewing past expenditures, we help schools uncover hidden opportunities for VAT recovery that they might have previously been overlooked.

In addition to the immediate cost savings, schools can benefit from establishing robust VAT recovery processes moving forward. This proactive approach ensures that as new costs arise, schools are well-positioned to reclaim VAT efficiently. The long-term benefit is a more sustainable financial model that can better withstand regulatory changes and economic fluctuations.  Engaging with VAT experts can provide private schools with the necessary guidance and support to maximise the benefits to be had from VAT registration.

We are, at the time of writing, pending the General Election and we do not yet know what the future holds for VAT in the private education sector but understanding the nuances of VAT regulations and implementing effective strategies for VAT recovery can transform what initially seems like a financial setback into a strategic advantage.

If you are a private school facing the challenges of the impending VAT on school fees, we encourage you to reach out to us. We are committed to supporting you through this transition, helping you identify reclaimable historic VAT, and establishing efficient VAT recovery processes for the future. Together, we can mitigate the impact of increased fees and ensure a more financially resilient future.

If you would like to discuss any area of VAT and establish how we can assist you in navigating these potential changes and optimise your ability to make VAT recoveries, contact us on 020 7870 9050 or email us at

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