AIBU to think that VAT on school fees is the same as paying tax on private healthcare.

Ourdearoldqueen · 2024-09-26T13:48:10+00:00

You pay your money, you take your choice surely?

Boohoo76 · 26/09/2024 18:58

Ourdearoldqueen · 26/09/2024 14:51

It was that shockingly bad post about the boy fishing that made me think about it that way. I have private cover through work. It’s nice. I jump the queue, I don’t have to sit with the proles if I need anything. But I could also opt out and keep the £ as salary. Can’t see why school fees are different.

It’s different because your employer pays for your healthcare. Tax is charged in the same way that you pay tax on your salary. If you paid for the medical insurance yourself, you wouldn’t be paying income tax on it.

itchycheek · 26/09/2024 18:48

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FriendlyNeighbourhoodAccountant · 26/09/2024 17:00

celerymunch · 26/09/2024 16:04

i don’t get mine through my employer 🤷

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So the post is irrelevant to you then as I clearly state from an employer, as did the OP.

ATuinTheGreat · 26/09/2024 16:18

loudbatperson · 26/09/2024 15:33

The tax you are paying for the healthcare through your employer is income tax not VAT, this is amount referenced on your p11. It's to ensure you are taxed on the payments being made by your employer on your behalf, as they form part of your income.

Private healthcare premiums are not subject to VAT. Instead it is IPT that is charged, and that is 12%.

I support the charging of tax onto school fees, however I think a separate type of tax, such as that for insurance premiums, would be a better approach than VAT.

This.

You’re not comparing the same thing at all. If employers were paying for private school fees for their employees’ children, then yes, that would be similar in the way people are saying, but being taxed on private health insurance provided by your
employer is just income tax payable as it is a benefit in kind.

VAT on school fees is nothing like this. It’s having to pay 20% more for something you are actually buying out of already (heavily) taxed income. And also it’s a massive purchase that you’re already committed to.

The effect of it financially for those people affected is as if the government suddenly decided to make everyone pay 20% extra on their mortgage each month as a homeowners tax or something (only in most people’s cases the school fees are more expensive).

You don’t actually pay VAT on private healthcare fees anyway, so it’s not a good comparison at all.

TheJones · 26/09/2024 16:16

Education not taxation Facebook group with legal challenge on VAT

Agree - private healthcare, nurseries and university will fall under the same increase if it goes through.

Badbadbunny · 26/09/2024 16:14

You don't pay VAT on private healthcare. It's VAT exempt, just like how education used to be.

Surely you should get a tax refund for not using public services and making your own provisions, rather than being taxed on them?

Original poster

Ourdearoldqueen · 26/09/2024 16:12

I’m a high rate payer for a PLC, and I’m taxed heftily at my highest rate. The point I am making is, that’s my choice. I could stick with the NHS and take the perk as income. Just as I could stick to state schools and not expect a tax break on the fees.

My family and I save the NHS £££ by using private services. My company pays the premium for me as a benefit and then I pay for the kids and partner at preferential rates.

OP posts:

celerymunch · 26/09/2024 16:05

and your employer will. e securing private health on your behalf at a much reduced rate than if you’d gone to the open market as an individual

so comparing private health purchased via your employer can’t be compare with VAT on fees

celerymunch · 26/09/2024 16:04

FriendlyNeighbourhoodAccountant · 26/09/2024 15:31

A like for like comparison would be including the 20, 40 or 45% tax you will pay for having private healthcare as a benefit from an employer.

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i don’t get mine through my employer 🤷

loudbatperson · 26/09/2024 15:33

The tax you are paying for the healthcare through your employer is income tax not VAT, this is amount referenced on your p11. It's to ensure you are taxed on the payments being made by your employer on your behalf, as they form part of your income.

Private healthcare premiums are not subject to VAT. Instead it is IPT that is charged, and that is 12%.

I support the charging of tax onto school fees, however I think a separate type of tax, such as that for insurance premiums, would be a better approach than VAT.

FriendlyNeighbourhoodAccountant · 26/09/2024 15:31

celerymunch · 26/09/2024 15:29

but like for like comparison is

private school VAt 20%
IPT on private health 12%

A like for like comparison would be including the 20, 40 or 45% tax you will pay for having private healthcare as a benefit from an employer.

celerymunch · 26/09/2024 15:29

but like for like comparison is

private school VAt 20%
IPT on private health 12%

celerymunch · 26/09/2024 15:28

what tax rate do you pay on that benefit op?

Justice4Friend · 26/09/2024 15:28

I don't have private care with anyone, I fund it myself.
I agree that it is the same as putting 20 percent vat on it as they have done with private schools.
Supported by jealous people that couldn't afford private schools themselves.
How is taxing private schools going to help all those kids who have lazy parents that don't care bout their education anyway?
How is it going to help state schools improve?
Teachers aren't allowed to discipline anyway so how does taxing private schools give them any power?
It's all lies - it's just taxation and it's supported by jealous people who can't think logically but with jealousy.

FriendlyNeighbourhoodAccountant · 26/09/2024 15:22

celerymunch · 26/09/2024 15:19

if your employer is a limited company

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What are you talking about? The employer being a limited company or not has no bearing on the OP being taxed on her healthcare as a benefit in kind.

celerymunch · 26/09/2024 15:21

sorry ex was a director and that was my experience

what rate do you pay op? on your private health?

celerymunch · 26/09/2024 15:19

Ourdearoldqueen · 26/09/2024 15:18

How?

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if your employer is a limited company

Original poster

Ourdearoldqueen · 26/09/2024 15:18

celerymunch · 26/09/2024 15:17

eligible for tax relief

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How?

OP posts:

celerymunch · 26/09/2024 15:17

FriendlyNeighbourhoodAccountant · 26/09/2024 15:10

It's not a mistake. If the OP gets private healthcare as a benefit from her employers it'll be subject to income tax at whatever rate is applicable.

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eligible for tax relief

FriendlyNeighbourhoodAccountant · 26/09/2024 15:10

celerymunch · 26/09/2024 14:53

then that’s a mistake

IPT on health insurance is 12%
0% on permanent health insurance

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It's not a mistake. If the OP gets private healthcare as a benefit from her employers it'll be subject to income tax at whatever rate is applicable.

celerymunch · 26/09/2024 15:08

damn sight better than 20% 🤷

celerymunch · 26/09/2024 15:08

i’d be happy with 12% being added on to my school fees

celerymunch · 26/09/2024 15:07

Ourdearoldqueen · 26/09/2024 14:55

Permanent health insurance is where you insure your income and it’s paid if you can’t work due to health, right?

correct

Original poster

Ourdearoldqueen · 26/09/2024 14:56

celerymunch · 26/09/2024 14:53

then that’s a mistake

IPT on health insurance is 12%
0% on permanent health insurance

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I’ve added my kids and partner on, and I pay for them too, at some sort of preferential rate.

OP posts:

Original poster

Ourdearoldqueen · 26/09/2024 14:55

Permanent health insurance is where you insure your income and it’s paid if you can’t work due to health, right?

OP posts: