Any teachers that use salary sacrifice out there for school fees???

[Piggychunk]

Evening,

DH will be starting an independent school in Sept and we are looking at maybe sending our boys IF we we can afford it. We get 30 % off fees plus we can salary sacrifice the rest over 12 months .. Will this be for remainder balance or is there a limit HMRC states?

Emailed bursar but not reply and I know mumsnet has the answer to all questions

I'm fairly sure the max you can sacrifice is £120 a month if you enrol now, £243 if you've been enrolled a while and is reducing to £110 in a year. That's per person per month. I'd be surprised if you can salary sacrifice the 70%. The HMRC web site is actually quite good on this.

Didi - I think you are talking about childcare vouchers, I'm not sure if the OP is also talking about these.

The value of childcare vouchers is only reduced for people joining schemes since April 2011, there is nothing that I can see on the hmrc website indicating there will be a reduction for higher rate tax payers who were already enrolled prior to April 2011.

Thanks for the replies I've been looking on HMRC but cannot find much information ( although could be just me ) I don't think it will be classed as Childcare vouchers???? but again could be totally wrong.

It will depend on the scheme the school has agreed with HMRC. It might have a cap or they might have agreed that it can cover all the fees.

It's not the same as the childcare vouchers scheme so won't have the same limit.

Another thought is (because I don't know anything yet about salary sacrifice, our bursar is looking into it for us but i do think it is classed as childcare vouchers as that is why we - and more ilportantly DH as a higher rate tax payer who has been getting them for 4 years and stayed in the scheme) can you apply for a bursary to top up the fee remission?

Our school does give bursaries to members of staff on top of fee remission is they are elegible.

There is a tax case called pepper v hart which was about school fees and favourable discounts given to teachers. It could be something to do with that case.

Thanks for all your replies .. hopefully I will get an answer at some point today.. If I do I will come back just in case it helps someone in the future

If you don't hear back from the this morning, give HMRC a call. I had to call them about a couple of grey areas when I was self employed and always found them to be very helpful.

You cannot salary sacrifice to below the minimum wage level.

What the tax position is on salary sacrifice for school fees, I don't know.

Thanks never.. If it the same as childcare vouchers it will be a no to send them so I need to find out asap. The school doesn't do bursaries for pre prep and prep so that isn't an option . :(

Childcare vouchers can only be used for childcare, not core education. They are limited to nursery/EYFS (the non-statutory years) and before/after-school or holiday clubs for older children.

If there's a sacrifice scheme other than a voucher-based one, you (and the bursar) will need to check carefully about whether the scheme fits the rules.

There is a good article on salary sacrifice for school fees here:
www.fismagazine.co.uk/financial/accounting/salary_sacrifices.html

It is not the same as childcare vouchers, but the marginal cost to the school of providing the place (HMRC presumption is 15% fees) is a taxable benefit.

trying again with the link:

www.fismagazine.co.uk/financial/accounting/salary_sacrifices.html

Thank Candy I was just coming on to say we have been sent a booklet on it via email and I think we will be taxed and NI on 15% of fees IF I have it right

That sounds right - you basically have to pay 15% out of your post tax income, but the rest comes out pre tax via sacrifice. Sounds like a good deal, especially if you get discount too!