Any other Heads publicly worrying about VAT?

How far back can VAT be claimed? I should know but I can't remember?!One of my DCs schools has recently completed a big building project. Presumably they couldn't claim back VAT on any of the costs but will be able to if they can backdate?
Once you factor in capital expenditure for lots of schools the VAT charged on fees could be reduced to very little.

@Caps1974 - lots of parents I know with children at private school don't vote Tory and never will.

Ok so here’s what I don’t get.

As a state school parent I know that schools have had loads of increases in costs, without corresponding increases in budgets. This means cuts.

Private schools are in a much easier position. If their costs increase, they can EITHER increase prices OR implement cuts.

HTs will surely be trying to work out what mix of this they do (cut 10% and increase prices 10%? Or another mix).

Big article now in the Telegraph too. We have a DD at boarding school. I wonder if the VAT would be on the boarding fees as well as the academic fees. Either way, it is a large amount extra.

On that basis presumably the 95% of parents who do not send their children to private schools will not vote Tory, as they Tories aren't interested in state education.

I don't think that's right. Charities aren't exempt from VAT. The reason that there is currently not VAT on fees is because education is an exempt supply. That applies equally to those private schools that are charitable and those that aren't.

In any case the charity issue is far more complex and would require legislation. I don't think the VAT change does.

If your private school fees are going up around 3-5k per child, trust me you will vote tory...this is where I'm grateful we decided on one child.

If they remove Charitable status, then VAT is applied automatically. They need a majority in the house of commons / lords as well to get this through....which they appear to have in abundance....so it will go through. Even if the Tories abolish inheritance tax, I can't see how that will be enough to stop Labour winning.

I am not sure that they need a large majority to do this as I am not sure that it requires legislation to levy VAT. The VAT Act allows the Treasury to change the defintion of exempt supplies by regulation https://www.legislation.gov.uk/ukpga/1994/23/section/31 that suggests that they could do this whenever they want as long as they are in government. I am no VAT expert so may be wrong.

The (often conflated but separate) issue of charity status is much more complicated and would need legislation.

@Caps1974 incorrect but don't let your sweeping assumptions get in the way of facts.

People who have children in Private School will vote Tory.

The local state school provisions are dismal because of the Tories. I presume on that basis you will not be voting for them?

The predicted majority is pretty big for now.....if somehow the majority narrows, then it get more difficult for Labour to push this through....but at the moment the Tories are losing badly.

We would not be able to afford it so I would not be voting Labour. I don't want to see the Tories in again but I will not vote Labour at the expense of my children's education - one has SEN and the local state school SEN provisions around here are dismal.

If the Tories do something about inheritance tax then they will get a lot of the older votes so it is not a foregone conclusion that Labour will get in anyway.

The school I’m talking about, definitely gives places to local children for free. Not all children fit into mainstream schools, some of the independent schools give places for free for the whole of the child’s time at that school. That’s certainly a charitable thing to do. To offer families who wouldn’t be able to afford the education normally a free place is a huge thing.

By giving the school a tax break it allows the school to offer these children an educational opportunity they would not have access to. Why shouldn’t they have a tax break for that?

But if they are indeed running charitable endeavours, why shouldn't they get the tax break?

And if those running those "charities" genuinely believed in those purposes they would continue to do so, whatever the status was.
Its a sop to get a tax break.

@jgw1 it's doing charitable things. It's giving access to facilities that the children wouldn't otherwise have access to. It's supporting children from poorer families to access a great education:".

If that is the case then the school isn't really a charity, it is just doing those things to justify a tax break. Seems like a strong argument for removing the status then.

The charitable status is relevant for children on bursaries. The school also loans the swimming pool to the comprehensive locally and sends a coach to transport the children to the pool. This is all for free, under the charitable status.

I suppose the comprehensive would lose out on swimming lessons and the children on bursaries would have to leave.

This is a culture war policy. It doesn't need to make financial sense. It's about throwing red meat to the left wing extremists to compensate for other centrist positions Labour need to take to get elected. Whether it will happen or not is kind of neither here nor there for the culture warriors on each side. It won't make any difference to state school children. It won't make any difference to inequality. In fact, it will worsen it as independent schooling will become more exclusive. Those of us with kids in schools with charitable status will just have to hope that Labour commission an assessment of the impact of this policy before going ahead because it is not worth wasting political capital on. The Red wall won't care.

20% would definitely see numbers drop. Is that’s what Keir wants ? The amount of vat will be very small in the scheme of things.

It’s estimated that VAT on school fees could bring in £1.3 to £1.5 billion, and that private school pupil numbers won’t reduce by much, plus those parents taking children out will spend the saved fee money on other VAT rated goods and services.

https://ifs.org.uk/sites/default/files/2023-07/IFS-Report-R263-Tax-private-school-fees-and-state-school-spending.pdf

I don't know the ins and outs of VAT but my DH is disabled and he doesn't have to pay VAT on things he needs due to his disability e.g. electric bed so he can actually get in and out of it. Something similar might be worked out for schools for children with SEN.

as someone with year 4 and 6 children and considering the local private option, but not being a high income family, this is something that will likely rule private out for us.
I think I broadly support the policy but its the squeezed middle classes who will be priced out of it. Surprise surprise. Labour need to be very careful with this - it will have an impact on the kids of all backgrounds fighting for places at
the better state schools, surely.

Ideally there would be a great education available to all, but it's not that straightforward is it.

Our head is concerned about it I think. If VAT is added then I think that will reduce a lot of inclination to fund bursaries - money which comes from current and past pupils. We certainly couldn’t and will be cutting back elsewhere considerably to afford it until there is a natural exit point eg moving for A levels etc.

having read on the teacher boards about just now dire the situation is in the schools those teachers are in, - and no amount of VAT is going to fund what needed - especially as the studies were done before interest rates etc rose, so don’t show the full current effect (and the true cost - if more have to move as we will do, the pupil funding will need to go up) , it rather feels like the solution to a problem is make everyone have a rubbish education rather than trying to lift up others. Am not convinced this policy will have the effect they want it to. And if it doesn’t then, it’s just a way of hitting more high middle class earners. The people on 300k plus won’t feel the pinch. But two working parents on 80k each (which is a lot of parents at our school), will do and will have to plan accordingly.

We have one DC at private ( never intended to go private but circumstances led us to moving her out of a state comp) and are at the lower end income wise compared to most at the school. We will be fine with the increase - it will mean cutting back in other areas but we would never consider removing her from the school. Looking at the expensive cars and lavish lifestyles of the families at her school I don't think it will have much of an impact. I was surprised when the school governor mentioned the VAT increase at the school prize giving. I found it odd to be talking so seriously about a policy from a political party that are not even in government. I will be voting Labour as I've always done but I still fear this Tory government will still find a way to hang on.