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Original poster

VAT and Bursary impact

288 replies

tam255 · 02/08/2024 13:49

For some parents in London on a reasonable income who can’t afford to buy in the catchment of a good/ outstanding school, sending to a private school with partial fee assistance/ bursary is the next best option.

Often these big private schools in London in fact often support the state sector, local schools in their area with use of facilities, pools, drama studios etc and are very generous indeed even with teaching staff, Saturday schools etc supporting local schools. This important fact just seems to be forgotten.

As for the student intake, in fact in London most of the private schools have more diversity than the superselective Grammar schools!! Getting a place into a superselective Grammar school for a child in London requires deep pockets. A bright child who cannot afford all the numerous tutors and mock classes etc has no chance of getting through a superselective grammar school and if you can’t afford to live in the catchment area of a good comprehensive will miss out there too.

The reality is that, if a child on a part bursary is in primary school yes, you could have an option to move to a state school at some point. However if a child on a part bursary say is in private secondary school yr 9 onwards ( where subject choices etc have been made) it’s going to be impossible to just change them to the state sector till sixth form.

Yes, there will always be millionaires and billionaires in the private schools but also a lot of parents who are covered partially with bursary’s. With all the vat added it will impact the bursaries which is sad and more importantly the support the private schools offer to the local state schools around in their catchment.

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PeachSalad · 18/09/2024 20:43

Tiredalwaystired · 18/09/2024 16:51

I’m in North West London and I’d say that’s true round here. So many excellent secondaries and sixth forms.

West London, Ealing area has many great school and then South West, Richmond

Tiredalwaystired · 18/09/2024 16:51

I’m in North West London and I’d say that’s true round here. So many excellent secondaries and sixth forms.

PeachSalad · 16/09/2024 07:11

Helpmymumplease · 16/09/2024 00:01

@PeachSalad where is what?

Outer London is the bit of London that is not inner London.

The West Mids is aorund Birmingham but stretches for miles. The East Mids encompasses parts of Derbyshire, Notts, Derby, etc.

Obviously I am asking if it is South, West, East or North London.

Helpmymumplease · 16/09/2024 00:01

@PeachSalad where is what?

Outer London is the bit of London that is not inner London.

The West Mids is aorund Birmingham but stretches for miles. The East Mids encompasses parts of Derbyshire, Notts, Derby, etc.

PeachSalad · 15/09/2024 22:11

Helpmymumplease · 13/09/2024 23:49

I live in outer London where state sixth forms are uniformly shit hot. Catchments are relatively large and even the super selective grammar lets some comp kids in for a levels.

This year we considered moving to the East Midlands and then the West Midlands where I’d have been confident in finding a good state sixth form.

I do understand it’s not like that everywhere but if you live rurally you get cheaper house prices. Horses for courses.

I personally would never ever pay for private sixth form but I know some people value it and that is fine - you do you!

Where is that?

Newskool · 15/09/2024 09:47

@AgathaMystery I meant having an external bursary, so not a cost the school can just absorb.

My SEN DC gets a substantial bursary from the school, who have said nothing concrete about the VAT so far. Leaving would be catastrophic for DC, educationally and emotionally.

TizerorFizz · 15/09/2024 01:11

@AgathaMystery I think the issue might be that VAT is a consumer tax. You are consuming education. The supplier (the school or charity) isn’t. Therefore I’m not sure they can pay VAT for you but they could increase the bursary to cover the vat but it’s not their tax to pay. It’s a tax a school will now collect. (Or not!!!)

AgathaMystery · 14/09/2024 23:40

@Newskool thanks I have emailed. I’m not sure I am unique. I cannot be the only parents with a child on a bursary that doesn’t include VAT?

WomensRightsRenegade · 14/09/2024 21:39

Consultation period? Wow. I really thought it was a done deal. Esp with many private schools having announced fee rises from January.

I do wish they would, at the very least, implement the change from September 2025 instead of January. That is a really savage thing to do, mid-year

Newskool · 14/09/2024 21:19

There's a consultation period ending tomorrow!
https://www.gov.uk/government/publications/vat-on-private-school-fees-removing-the-charitable-rates-relief-for-private-schools
Comments can be sent to the email address at the end of the third document.
The impact on bursaries and SEN was ignored in this policy, and @AgathaMystery your situation seems quite unique, so might be worth flagging.

VAT on Private School Fees & Removing the Charitable Rates Relief for Private Schools

Technical consultation on the VAT and business rates changes affecting private schools.

https://www.gov.uk/government/publications/vat-on-private-school-fees-removing-the-charitable-rates-relief-for-private-schools

Xenia · 14/09/2024 10:55

It is one reason those who owned massive country estates used boarding schools really as there would not be a decent local school in some of those gorgeous rural areas so sending the child to board was the compromise I suppose.

I hope Labour rethinks and does not proceed or the litigation succeeds in stopping this in its tracks.

AgathaMystery · 14/09/2024 10:45

Helpmymumplease · 13/09/2024 22:58

@AgathaMystery so the external bursary provider is holding their contribution steady but it won’t cover as high a percentage of fees, right?

what is your school saying about how it can mitigate impacts on those who are less able to pay higher fees?

I don’t want to derail the thread but the school is absolutely firm about no mitigation as the bursary is external. They haven’t been unpleasant about it but they haven’t offered false reassurances or promises.

I suspect we are quite a small group of parents (external bursaries are hard to come by and hard to get - ours was anyway).

It’s just another unthought of consequence of this petty, reductive policy. It’s just one child to everyone who supports VAT but to us it’s our whole world and has impacted every financial decision we have made (and so much sacrifice) since 2015.

again, apols for derail

Muchtoomuchtodo · 14/09/2024 08:25

rosemary2042 · 13/09/2024 23:42

Where do you live? Mind to share? I would love to send my kids to state schools where there are no Independent ones.

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We live in The Vale of Glamorgan, South Wales.

Helpmymumplease · 13/09/2024 23:49

I live in outer London where state sixth forms are uniformly shit hot. Catchments are relatively large and even the super selective grammar lets some comp kids in for a levels.

This year we considered moving to the East Midlands and then the West Midlands where I’d have been confident in finding a good state sixth form.

I do understand it’s not like that everywhere but if you live rurally you get cheaper house prices. Horses for courses.

I personally would never ever pay for private sixth form but I know some people value it and that is fine - you do you!

rosemary2042 · 13/09/2024 23:42

Muchtoomuchtodo · 03/08/2024 17:35

I have no idea of the answer to this, I am genuinely interested.

For those on bursaries at private schools, what kind of ballpark figure would VAT on the proportion of fees that they pay add each year?

We only have 1 private school in the whole of our county with only 250 pupils from age 2-18. 40 in the entire sixth form. Despite only being 6 miles away, I am not aware of any opportunities or support that it offers to local state schools. There are no private schools at all in 2 of our neighbouring counties.

My child has chosen to stay at state sixth form not just for the A levels but the other opportunities that they will get there - the sports teams, the choir, playing in the music ensembles at national competitions etc. They definitely would not get those opportunities at the private school.

Where do you live? Mind to share? I would love to send my kids to state schools where there are no Independent ones.

Helpmymumplease · 13/09/2024 22:58

@AgathaMystery so the external bursary provider is holding their contribution steady but it won’t cover as high a percentage of fees, right?

what is your school saying about how it can mitigate impacts on those who are less able to pay higher fees?

AgathaMystery · 13/09/2024 16:18

user149799568 · 13/09/2024 09:54

So, hypothetically, if ex-VAT tuition was £6000/term, you were paying £1500/term (25%), you now need to pay £2220/term (the £1500 plus an additional 12% of the full £6000)?

Is your bursary provided by the school or by an external organization?

Edited
Show quote history

Correct. The Bursary is an external one from a private charitable trust not affiliated with the school. They wrote to us to say they will drop the Bursary to 30% next year and withdraw it the year after

user149799568 · 13/09/2024 09:54

AgathaMystery · 12/09/2024 17:04

Yes.

We are in this exact position (DC 75% bursar) and need to pay 12% VAT in 4 pay cheques times.

No idea how. None.

Show quote history

So, hypothetically, if ex-VAT tuition was £6000/term, you were paying £1500/term (25%), you now need to pay £2220/term (the £1500 plus an additional 12% of the full £6000)?

Is your bursary provided by the school or by an external organization?

AgathaMystery · 12/09/2024 17:04

IncessantNameChanger · 06/08/2024 08:30

If you have say 70% bursary do you still pay full vat? I wonder how it's going to work in reality?

Yes.

We are in this exact position (DC 75% bursar) and need to pay 12% VAT in 4 pay cheques times.

No idea how. None.

Tiredalwaystired · 21/08/2024 19:02

Seasaltlady · 21/08/2024 14:29

Yes, all very poorly thought out and with no long term vision at all…. As is everything with Labour unfortunately.

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Because the Tories have done an excellent job these last fourteen years, right?

Honestly I would t mind the Labour digs so much if they had a track record in recent times but they’re not being given a chance.

I can understand if you have a single topic issue with what they’re doing (like VAT on private schools if it affect you) but EVERYTHING??!

Some of their advisory appointments have been outstanding. Their swift response to the riots squashed the immediate danger extremely quickly.

Seasaltlady · 21/08/2024 14:29

potionsmaster · 07/08/2024 15:20

This makes horrifying reading about the state of the SEN system https://www.theguardian.com/education/article/2024/aug/04/special-educational-needs-system-england-utter-disarray-ombudsman-amerdeep-somal The VAT plans will add an unknown number of additional children with SEN needs into the state system. According to the Labour manifesto, not a single penny of the predicted private school VAT revenue will be spent on special needs education.

Yes, all very poorly thought out and with no long term vision at all…. As is everything with Labour unfortunately.

Seasaltlady · 21/08/2024 14:27

DadJoke · 02/08/2024 14:48

Sending them to the local state school really is the solution if they really can't afford the 20% on the school fees they pay. Maybe the local private school will let them use their swimming pool once a week. I've heard they are very helpful.

Or, they could downsize, remortgate, ask their parents for money, or miss out on a couple of holidays.

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Soooo resentful!! Must be miserable being you!

IncessantNameChanger · 07/08/2024 16:54

AgathaMystery · 07/08/2024 16:32

This is also my understanding.

I think we fall into the category of people that most people are gloating about. There is almost no understanding that this policy will not affect the wealthy one bit. They will not even notice.

And trust me, people are gloating.

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The British do love to see people fail IMO. I could never afford private schooling but I can't begrudge anyone striving to improve their lot. Our village private school is the only business in the village. It employs lots of non skilled staff.

Seeing my boys in indi sen schools I have been very lucky to able to know that state and indi are a world apart. In state we had to be grateful to get nothing. In independent people want the kids to thrive.

AgathaMystery · 07/08/2024 16:32

user149799568 · 07/08/2024 15:29

I think there may be a difference depending on whether the bursary is provided by the school or by a third party. My understanding is that, if a school is providing a bursary, it is structured as a tuition fee remission, i.e., the school charges a lower fee. Whereas if an external organization provides the bursary, the school charges full fees but the organization pays part of them.

If, hypothetically, the full tuition is £15,000 per year and the school grants a 60% fee remission, then the school charges reduced tuition of £6,000 per year and someone will need to pay VAT on that £6,000, so someone will need to pay £1,200. If, however, the bursary is provided by an external organization, the school charges the parents £15,000 tuition and the charity grants their child £9,000, usually by sending it directly to the school. But someone will then be liable for VAT on the £15,000, so £3,000.

Edited
Show quote history

This is also my understanding.

I think we fall into the category of people that most people are gloating about. There is almost no understanding that this policy will not affect the wealthy one bit. They will not even notice.

And trust me, people are gloating.

user149799568 · 07/08/2024 15:29

AgathaMystery · 07/08/2024 08:08

I am wondering this too. My DC was 75% bursary last year and has received 50% this year. It’s not from the school - it’s from a private bursary Trust.

They have said they can’t support from next year due to VAT. They sent me a very firm but polite email.

Show quote history

I think there may be a difference depending on whether the bursary is provided by the school or by a third party. My understanding is that, if a school is providing a bursary, it is structured as a tuition fee remission, i.e., the school charges a lower fee. Whereas if an external organization provides the bursary, the school charges full fees but the organization pays part of them.

If, hypothetically, the full tuition is £15,000 per year and the school grants a 60% fee remission, then the school charges reduced tuition of £6,000 per year and someone will need to pay VAT on that £6,000, so someone will need to pay £1,200. If, however, the bursary is provided by an external organization, the school charges the parents £15,000 tuition and the charity grants their child £9,000, usually by sending it directly to the school. But someone will then be liable for VAT on the £15,000, so £3,000.