VAT private school requirement to give one terms notice to leave

[KHB]

We have four children who are educated in the private sector. When we did our sums prior to the VAT announcement we could just about cover the fees whilst making many sacrifices to enable us to afford it. We hoped the VAT would be introduced in September 2025, as did the schools we attend, giving us time to work out whether we could afford to continue and give notice to leave if required. Now this has been brought forward to January, the additional cost to us due to VAT is £8850 for this school year alone (spring and summer term 2025). We simply cannot afford this.

Our eldest is due to start senior school in a few weeks time at the start of September (year 9). This school is the most expensive of all the fees we pay. We have made the difficult decision to pull him out and move him to our local state school, who have been incredibly helpful in finding us a place last minute and even allowing us to look around the school during the holidays.

However we are left in the situation where the senior school we are leaving (before we have even started) insist that we pay a full terms fees for pulling our child out without giving the required one-terms notice. My view is that the immediate cost of school fees has increased beyond everyone's expectations, and it would be incredibly detrimental to our son's education and his mental health for him to attend for just one term before being forced to move to a different school. I have written to the bursar to ask him if he would exercise his discretion and consider waiving this requirement. However, I have received little sympathy.

I have heard that some schools are waiving the term's notice requirements to allow parents, like us, to move their children with immediate effect if they can no longer afford to continue paying their school fees. I would be interested to know how other parents have been treated? Does anyone know if there is any scope for legal action to fight the terms and conditions? I would be grateful for any positive contributions. Thank you.

OP - I recommend you start a new thread in Legal on this as you're getting a lot of incorrect legal advice (eg statements that if it's in the t&C's there's no possibility if challenge and the express statement that if you pay a 'non-refundable' deposit for a venue and then cancel it's irrelevant if the venue is rebooked). I am not am expert in this area but as a general principle of English Law, for the school to be entitled to claim compensation for breach of contract (claiming the term's fees because you didn't give notice), they have to have suffered loss. It's likely material whether the place will be filled or not.

My friend’s daughter was advised with less than a term to go that the school would be unable to fit her preferred subjects into the timetable so they moved her to a different private school. Still they would not budge in them paying a full term of notice. They fought it hard (dad is a lawyer) but ultimately had to pay. A year or so later they were turned down for car financing because the school had sent the debt to a collection agency

I have a bit of sympathy with that though. Given the school were arguably the ones not delivering, they could’ve compromised on the fees.

Also schools are not obliged to pass on the full 20% - some will some won’t but I doubt the school have actually announced how much they will pass on yet. It’s entirely possible the increase will be less than you fear.

Of course they can. Small claims court doesn't cost much.

The reality is though the fee increase is in January, many parents will muddle through to the end of the school year.

You are choosing instead not to start the year. That is your choice.

You could make other choices like moving the younger children mid year and prioritising private senior school going forwards. Your personal choices are not the schools concern though it must be frustrating.

Granted you have more limited options for muddling through as you currently have 4 sets of fees (which is a big financial commitment that, if not funded by saving or trust money but day to day income, always had an element of risk) but that was the right choice at the time for you.

I work in finance in a mid sized independent senior school, it is happily rare that we get a parent default, but if it happens and we cannot get them to pay we have an arrangement with our bank called factoring.

Basically the bank gives us (usually 80%) of the debt and in return purchases the rights to the debt and will then recover it, this means we would never have to take a court action.

Normally 2 late payment invoices would be issued a month apart and then a notification that the debt is being factored - if its still not paid the bank pay us and take over.

A rarely used facility, but a useful, and not that uncommon tool.

The government is doing a consultation and people should write in with their concerns before they finalise their plans: independentschools at hmtreasury.gov.uk

As much as people will say this policy was long time coming, no one would have pulled out their children of their current schools until policy was formally announced . People also hope governments can be more pragmatic. Parents who would have potentially put their kids in private school may have very well made different choices before starting school. That i can understand.

So implementing this mid school year is just not helpful.

OP, i think keep talking with the school. Both are in difficult situations. If someone else takes up the place last minute or mid term you should negotiate to get some of the money back.

Unfortunately there are two types of independent school parent, those who budget tightly, have regular jobs and not a huge inheritance or trust fund - and those who are considerably more wealthy. The first group are heavily impacted by the new policy, the second not so much, if at all.

Whilst I understand the rationale behind the policy of adding VAT, and despite working in the sector don't entirely object to it (as a school it won't impact us hugely with our demographic) what it is going to achieve is to make a private education far more elitist and not so accessible for normal working people.

Oh I have sympathy about it too. It’s bloody outrageous. I was just sharing as an example where the school didn’t give them a term’s notice of such a significant issue and yet they still enforced the contract.

People tend to minimise disruption for their children, just like OP whose child is starting new school in September, not mid-year. We could have stayed for another term to get our money's worth but we're also moving in September as DC will settle better in a new class. And in the same way someone who will take our place will be keen to start in September - people who are on the waiting list can well afford forfeiting one term's fees. The school will get double fees, I know it.

Of course they can force OP to pay. The school has a contract. The OP will also pay the school's court costs. So up to her how much she wants this to cost her

I think that there was a lot of misinformation and mid year rises when people have already budgeted is very unfair.

This was posted before labour won the election btw.

They say they discovered the economic situation was worse than expected. Who knows if it's true.

Yes it's unfair it's coming in mid-year.

I think most parents who will have to move their kids will survive for the rest of the year rather than jump now.

If the OP is taken to court it will be her paying the court fees

I think some schools are allowing parents to pay the fees a year (sometimes several years) in advance on the current tariff. Parents are literally selling holiday homes in order to do this and the school benefits from suddenly having lots of cash to grow.

I think the VAT applies to pre-payments as of last week. So if you hadn’t pre-paid before last Monday, you’ve missed your chance to avoid the VAT.

There’s no guarantee this will work. The schools or parents could still have to pay the VAT.

And as a PP said it’s not too late to try.

I second that, and as someone else has commented a County Court Judgement will affect your future credit score.

You really think it's a good idea for OP to incur costs and interest on top of the original debt? How much money would you like to put on the chances of a court giving time to pay to a family able to afford hefty private school fees for four children?

You have to pay the term's notice. You knew that when you signed up. You don't have a case.

V odd that any decent state school would have a place available in year 9? Even odder that they have been showing you round in the summer holidays??

Why do you think they can't force OP to pay? Taking her to court would cost a relatively small amount, given that OP has no defence, and she would end up having to pay costs and interest. They can enforce it in all sorts of ways - e.g. attachment of earnings, an order for the OP's bank to pay them direct, bankruptcy, etc. OP's is a family which could afford to pay £66K a year for just one child's fees, plus slightly smaller amounts for another three children, so it's not as if she's scratching around for money - you don't imagine the school is just going to write off £22K in those circumstances, do you?

The government announcement was to the effect that VAT will also apply to prepaid fees.

Yes those paid after 29 July. Anything before that is a grey area depending on the legislation.

The school my ds just left has written to all parents saying that in view of the fact that VAT is a massive mid year increase with not enough notice, that people are allowed to withdraw their children right away without getting fined a term’s fees.

op your school is well out of line with what reasonable schools are doing.