Vat Question????????

[Anoth]

Can I ask a silly question??
We have been given our school fees for 24/25 academic year now for the school my daughter attends.
My question is if labours policy comes in half way through an academic year will the schools be allowed to put the fees up for the remainder of that academic year? Eg if we start paying X amount on September and then labour get in and introduce the added vat in October. Will the fees go up in Jan of that academic year? Normally fees remain un changed for the whole of the academic year once fees have been published but I understand this is a strange situation!
Just wanted to know if I need to prepare to save more for 24/25 fees just in case or will these that are now published still remain until the end of July 25??.
Thanks!

But how is giving up work and homeschooling costing less money than paying an extra £4k in school fees?

You’re assuming that they can afford the £4K extra though? If they can’t, and choose to home school, they’re saving the £20k a year they’re currently paying in fees.

No I agree, so many people stay at home parents/ working very little or earning very little, and using state school. And hardly anyone questions how they can afford to do that or says they must be incredibly wealthy. Yet 2 working parents using private school get slated as being millionaires just because they pay £16pa for their child to go to school.

Quitting work to home school is only cheaper than private school if you have 2 or more children really (and home school them all). If not the loss of your salary would be more than the fees. Unless you earn way below minimum wage, or work part time (and again being a SAHP or Part time is generally a luxury which you are paying for by sacrifing the income!)

But surely home schooling isn’t a cheaper option or if it was an affordable and option that people were hapoy with they would have been homeschooling anyway and saving themselves a few quid. Most people aren’t homeschooling because they don’t want to home school irrelevant of cost. The whole “I will take my child out and home school them” doesn’t carry much weight, go for it if that’s what you want to do, and I say this as someone who doesn’t agree with vat on school fees but the whole threaten to pull kids out and homeschool, is a nonsense

You are not taking into account the loss in salary that would be incurred by giving up work? Which would likely be at least 20k (not to mention the future damage to career/ potential earnings that would last way beyond school year finishing)

I am. They currently net £20k per year, which is wholly spent on school fees. They are left with £0 after school fees.

Then they give up work and earn £0, but their education no longer costs anything. They are in the same net financial position.

For us as a family, we choose private education over home schooling because we feel it’s better. However, if we could no longer afford school fees, we’d choose to home school over sending them to a failing state school.

I am quite surprised that so many private school parents seem that they would just give up work if they didn't have to pay fees.
Is this what you would be hoping your own privately educated children would do in the future if the chance arose?

I don't care what my child does in the future long as she is happy. Education isn't just about outcomes

I’d hope that they did whatever made them happy and worked for their own family. A good education is about giving them options. I personally don’t see what’s wrong with a highly educated parent staying at home and educating the next generation if that’s what they choose.

I suppose if the second parent's salary is consumed by the school fees, and then the fees go up, talking the DC out and home schooling restores the status quo ante (disposable income remains the same if DC home schooled; but goes down if second parents' salary is exceeded)

I would hope any well-educated DC (regardless of how their education was paid for) would be capable of running a family budget in line with that family's priorities

Ok but this is assuming someone is on nearly minimum wage, or part time. That person could go full time or find a more lucrative job (not always possible of course, but for most private school parents is more of a possibility than most).

For the vast majority of people giving up work / staying a SAHP and home schooling is a more expensive option than working and paying school fees (unless you have more than two children).

Not to mention the other costs involved in home schooling other than loss of salary? If you want anything akin to a private education you'd need extra money for swimming lessons, drama classes, forest school, probably tutors, clubs, exam fees etc...?

For most educated people being a stay at home parent is costing anywhere from 30 - 100k per year in lost earnings. A lot more than school fees. And also impacts future earnings beyond the school years too.

Maybe you are thinking about London wages but trust me, in other parts of the country you can be highly educated and earning not much more than 30K

On £100k salary, you net around £67k. 2 children at private school could easily be £50k/£60k with VAT and extras. A lot of private school parents won’t have the second earner bringing in that much.

My DC are state educated and I would be concerned in the future if they were to stay at home and be depending on their partner's salary completely. This works well for many but I have seen too many women left high and dry after a separation to be confident it works for all.
It seems a fairly unique situation that a parent gets no benefit at all from working beyond paying for education and that their salary keeps apace with the normal increasing fees.
I have strayed off the point of the thread a bit though so won't derail any more.

Unfortunately, people seem to think that earning £100k is the norm and that both parents of a private school family will be earning at least that amount each…..

I don't think that's quite right. 2x DC at schools costing say £5k per term is £30k (out of income after tax and deductions). So you need to be earning about £37k pa, which is comfortably over both minimum wage (£20,800) and living wage (£25,500), and definitely represents a FT salary in many sectors

Yep. If you are outside London then only 1 parent needs to be earning that in reality.

Personally, I agree, and think it's a message that should also be rammed home to every woman (as it's almost invariably the woman) who takes a career hit because it's not "worth" working when childcare fees are higher than second parent's income.

I would hope that private schools are clubbing together to get good VAT advice.

So if the government exempt sports education/dance maybe drama, for example, then increasing these areas could mean some of the fees are exempt. Unless the new rules stop this. Ditto music, maybe some pastoral stuff. There is a lot of thinking to be done.

There is a lot of thinking to be done.

Let’s hope the thinking is done before blindly implementing the policy……

Not really sure about this notion that all the school fees - we're usually referencing the woman - would solely coming out of one parents earnings. Surely the money is pooled and then school fees come out of that?

Giving up work to home school for 10-15 years has a financial impact beyond the school years.

I think if you're in a position where an extra 8k a year makes private school totally unaffordable then you probably aren't in a great financial position to be having one parent not working for years on end.

Not everyone chooses private for 10 years+. We did state until Yr 7 then are doing Yrs 7-11 private. So will only be paying 5 years.
Yes my wage pays for school fees, that's no different to many parents I suspect and I know for a fact its the same for DD's best friend's mum. Her mum is a part time teacher which enables payment of school fees.

@Another76543

You'd hope they are thinking of the unintended consequences of changing a whole section of the vat legislation from exempt to taxable.

It's been a while since I looked at it but I wonder if the 10 year rules for capex mean schools will be able to look back and recover heaps of vat on past expenses.(where vat was charged). Ditto IT/sports equipment etc etc. I can't remember the rules but this could have an impact in reducing initial vat costs fairly significantly.

I haven’t looked at it for a while either, but I do think there’s scope to claim at least something back for past expenditure. That could potentially be huge for the wealthier schools