Guidance

Guidance for a private school, college or university supplier: report or seek approval for related party transactions

Updated 8 October 2024

Applies to England

From 1 October 2024 academy trusts should report or seek approval for related party transactions from the Department for Education instead of the Education and Skills Funding Agency. There has been no change to the process you follow to do this.

This page covers information and advice on reporting requirements for related party transactions (RPTs) where the supplier is a private school, college or university.

1. Reporting related party transactions with a supplier that is a private school, college or university

Approval is not required from the Department for Education (DfE) for the supply of goods or services to a trust by private schools, colleges and universities which are sponsors of the academy trust.

However, these transactions must be reported to the DfE using the RPT online form and will be regarded as meeting the ‘at cost’ requirements.

Summary guidance describes the requirement for academy trusts to report an intention to enter into a transaction with a related party before confirming the transaction. This includes transactions being renewed with a related party.

Academy trusts do not need to report income transactions with related parties. For an expenditure related party transaction with a new supplier, academy trusts must confirm whether they have previously received a donation from the related party.

Salaries and other payments made by an academy trust to a related party under a contract of employment through the academy trust’s payroll are not in scope of this reporting requirement.

Academy trusts must declare all related party transactions, regardless of value, in their annual financial statements as set out in the Academies Accounts Direction.

2. Seeking approval for related party transactions with a supplier that is a private school, college or university

Where the related party transaction value exceeds £40,000, DfE approval of the transaction is required if the supplier is:

• a private school, college or university that is not a sponsor of the academy trust
• a subsidiary of a university, school or college (including academies) regardless of whether its parent body is a sponsor of the academy trust, or owned by the academy trust

If the RPT is novel, contentious or repercussive or is for the appointment of an Accounting Officer or Chief Financial Officer who is not an employee of the academy trust, separate DfE approval is required.

3. Using the online form

You will need a DfE Sign-in account to use the form. Register for a DfE Sign-in account if you do not have one already.

The form is for academy trusts to report all expenditure transactions and seek approval where necessary for a transaction with a related party before it’s confirmed with the related party.

When creating a new supplier, you will need to enter the supplier’s details and choose from a list which best describes the supplier, and whether the supplier is a sponsor of the trust. If the supplier is a sponsor, your transaction will not require approval and is regarded as meeting the ‘at cost’ requirement. Where the supplier is not the sponsor of the academy trust and exceeds £40,000, your transaction will require approval and the ‘Using the online form’ guidance applies.

For all new suppliers, you must confirm whether the academy trust has previously received a donation from the related party and the type of donation: cash, in kind, both, or other.

4. Do you have any questions?

For all enquiries for DfE, contact us using the customer help portal.