Guidance

Check if you must register for VAT if you receive private school fees

If you're an education provider, check if and when you need to register for VAT to prepare for VAT being chargeable on school and boarding fees.

From:
HM Revenue & Customs
Published
10 October 2024
Last updated
13 December 2024 — See all updates

HMRC is hosting live webinars about VAT on private school fees, where you can learn about:

  • checking if and when you need to register for VAT as an education provider
  • recognising the goods and services you need to charge VAT on and reclaim VAT for

Find out how to register for upcoming webinars in the HMRC email updates, videos and webinars for VAT guide.

From 30 October 2024, school and boarding fees for school terms starting on or after 1 January 2025 will be taxable at the standard rate of VAT of 20%.

Education providers that charge school and boarding fees must check if they need to register for VAT because of these changes.

Who must register for VAT

You must register for VAT if you’re a private school or connected person that supplies education services or vocational training or provide boarding services closely related to educational or vocational training and either:

  • your total taxable turnover for the last 12 months is over £90,000
  • you expect to receive payments over £90,000 in the next 30 day period

Taxable turnover is the total value of everything you sell that is not VAT exempt or ‘out of scope’.

The test for whether a person is a connected person is set out at section 1122 Corporation Tax Act 2010. An eligible body may also be treated as connected where the private school and the eligible body have put in place arrangements mainly to benefit from VAT exemption on supplies that should be taxable. You can find out more about eligible bodies for VAT in section 4 of Education and vocational training (VAT Notice 701/30).

For VAT purposes, a private school is any school or institution that provides full time education for a fee to either:

  • pupils of compulsory school age
  • 16 to 19 year olds, where that institution is wholly or mainly concerned with providing education suitable to that age range

This includes:

  • private schools
  • independent schools
  • private sixth form colleges

Nursery classes provided by private schools consisting wholly, or almost wholly, of children under compulsory school age will be exempt from VAT. For example, a nursery class consisting of 90% or more children under compulsory school age will be exempt from VAT. If you’re a school that only provides nursery education you will not need to register for VAT.

When you must register

The exact date when you need to register for VAT will depend on:

  • the value of school fee payments you receive for terms starting on or after 1 January 2025
  • the date you receive the payments

Payments include registration fees paid during the application process to attend a school.

If you receive payments in advance then you may need to register before 1 January 2025, depending on when you received the payment.

If you register because you have exceeded the £90,000 VAT threshold in the previous 12 months, you must register within 30 days of the end of the month in which you exceeded the threshold. Your effective date of registration will be the first day of the second month after you went over the threshold.

If you register because you expect to receive payments exceeding £90,000 in the next 30 day period, you must register in the next 30 days. Your effective date of registration will be the date you realised you will exceed the threshold.

You should not charge VAT or produce VAT invoices until you have registered for VAT.

If you need to register for VAT and do not do so you may have to pay a late VAT registration penalty.

You can use this tool to check when you need to register for VAT for private school fees. It is for guidance only.

Check now

Payments received before 29 July 2024

How payments made before 29 July 2024 will be treated will depend on the specific terms of any agreement for the payment.

Where the payment creates a tax point for VAT purposes when the payment is made, no VAT will be due. A tax point is normally created when a service is performed or a payment is taken for a supply of goods or services.

You can find out more about tax points in:

Payments received from 29 July 2024 to 29 October 2024

Any fee payments received between 29 July 2024 and 29 October 2024 for school terms starting from 1 January 2025 onwards will be subject to VAT from the later of either:

  • the first date of the school term that the fees have been paid for
  • 1 January 2025

You should not charge VAT or produce VAT invoices until you are registered for VAT.

You cannot include VAT on your invoices until you get your VAT registration number but you can increase your prices to account for the VAT you’ll need to pay to HMRC.

Example

On 28 October 2024 you received £100,000 for private school education for the school term starting 6 January 2025.

As this is not yet considered subject to VAT, you do not need to register for VAT immediately.

These payments will become subject to VAT on 6 January 2025, when the school term starts. This means that on 8 December 2024 — 30 days before 6 January 2025 — you become aware that you will be over the £90,000 VAT threshold on 6 January 2025 and you must register for VAT.

You will have 30 days to register for VAT from 8 December 2024, as that is your effective date of registration.

You must also pay any VAT that may be due on fees paid from 8 December 2024, even though you will have not been given your VAT registration number yet.

Payments to non-maintained special schools

Payments received by non-maintained special schools between 29 July 2024 and 29 October 2024 will be treated differently and will depend on the specific terms of any agreement for the payment.

Where the payment creates a tax point for VAT purposes when the payment is made, no VAT will be due. A tax point is normally created when a service is performed or a payment is taken for a supply of goods or services.

You can find out more about tax points in:

Payments received on and after 30 October 2024

Any fees received from 30 October 2024 for school terms from 1 January 2025 onwards will be subject to VAT on the date you received the payment.

You will need to notify HMRC within 30 days if you realise the amount of payments you receive will exceed £90,000 in the next 30 days.

If they will not exceed £90,000, you will need to notify HMRC within 30 days of the end of the month that the total amount of payments you receive — along with any other taxable supplies you might be making — exceeds £90,000.

When calculating your taxable turnover from your past 12 months: 

  • only include school fees relating to school terms starting on or after 1 January 2025 
  • include fees from 30 October 2024 when they are received 
  • include fees received between 29 July 2024 and 29 October 2024 from the later of either 1 January 2025 or the start date of that term

You cannot include VAT on your invoices until you get your VAT registration number but you can increase your prices to account for the VAT you’ll need to pay to HMRC.

Example

On 5 November 2024 you are aware you will receive school fee payments over £90,000 in the next 30 days, for terms starting on or after 1 January 2025.

You are liable to register for VAT and must notify HMRC by the end of that 30 day period — that is by 4 December 2024.

Your effective date of registration will be 5 November 2024, as this is the date you realised you would exceed £90,000 within the next 30 days.

You must pay any VAT that may be due on fees paid from 5 November 2024, even though you will have not been given your VAT registration number yet.

Total payments exceeding the VAT threshold in a rolling 12-month period

If you receive payments of less than £90,000 in the next 30 days you will not need to register until your total taxable supplies over a rolling 12-month period go above that amount.

Payments received between 29 July 2024 and 29 October 2024 will not be subject to VAT until the later of the first day of term or 1 January 2025. You should not charge VAT or produce VAT invoices until then.

Example

It is 31 January 2025, and you realise that since the change in VAT treatment on 30 October 2024, you have received a total of £95,000 in fees for terms starting on or after 1 January 2025.

As you have exceeded the £90,000 threshold in the last 12 months, you must register for VAT with HMRC within 30 days of the end of January (the month the threshold was exceeded).

Your effective date of registration will be 1 March 2025.

This means you will need to start charging VAT from 1 March 2025.

Registering for VAT voluntarily

If you are an education provider that’s already providing services or goods that are chargeable to VAT and you are not yet required to be registered, you can register for VAT at any time.

If you are an education provider that is not providing services or goods that are chargeable to VAT now, you can register for VAT from 30 October 2024 if you provide or intend to provide private education for terms starting on or after 1 January 2025.

If you register voluntarily you’ll still need to meet VAT obligations, such as submitting VAT returns and keeping VAT records. You will also need to charge VAT on taxable goods and services you supply.

When you’ll need to charge VAT on school fees will depend on the ‘time of supply’ (or tax point). You can find out more about ‘time of supply’ in section 14 of VAT Notice 700.

How to register

Find out how to register for VAT.

When you register you should:

  • enter ‘Private Education Provider’ in the ‘Business activity’ section of the online application
  • use the guidance in the online application to help you select the Standard Industry Classification code that applies to you

How to choose your business entity

To register, you will need to know what type of business entity applies to your school.

A charitable incorporated organisation is an incorporated structure designed for charities registered with the Charity Commission.

A limited company is a company ‘limited by shares’ or ‘limited by guarantee’.

Registering as a charitable incorporated organisation

If you are registering as a charitable incorporated organisation and your Company Registration Number begins with the prefix CE or CS, when you register you should:

  • select ‘Other’ when asked what type of business you are registering
  • select ‘Unincorporated Association or Other Relevant Charity’ when you are asked what specific type of entity you are
  • leave the box blank when asked to enter a Unique Taxpayer Reference (UTR) or HMRC reference

If your school is a charitable incorporated organisation and has a Company Registration Number that does not begin with the prefix CE or CS, you’ll be able to register with your Company Registration Number. If you’re not sure what your registration number is, you can search the register.

If you are not registered as a Charitable Incorporated Organisation, there is more information available on setting up a charity and the different structures you can choose.

Registering as a UK limited company

If your school is a UK limited company and not a charitable incorporated organisation, you’ll need your Corporation Tax UTR in addition to your Company Registration Number. The reference will be on tax returns and other correspondence that HMRC has sent you.

If you do not know what your UTR is, you can ask for a copy of your Corporation Tax UTR if you have a Company Registration Number.  If you do not have a Company Registration Number, you’ll need to register with Companies House and HMRC will send you your Corporation Tax UTR within 15 working days.

Registering as a VAT group

If your school has more than one business entity (for example, as well as a business providing education there is another business that is a shop selling school sport equipment) it may be able to register as a VAT group. 

Find out more information in: 

Adding directors and director’s association details

You do not need to add information about your school governors and bursars to this section of the online application.

After you’ve registered

You will receive a letter from HMRC confirming your VAT registration number and explaining what you must do next.

This includes:

You’ll also be able to reclaim VAT on business expenses.

Get more information

You can also find out more about:

Updates to this page

Published 10 October 2024
Last updated 13 December 2024 + show all updates

  1. Guidance has been added to the "How to register" section to help you work out what business entity your school is.

  2. Welsh updated.

  3. More guidance has been added on how to calculate your taxable turnover from the past 12 months.

  4. Guidance on how to register as a charitable incorporated organisation has been added.

  5. Information about how to register for VAT has been updated to include further detail for charities and limited companies on what you'll need to do to register based on your school's circumstances.

  6. The 'How to register' section has been updated with guidance on how to find your Unique Taxpayer Reference so you can register for VAT.

  7. The 'When you must register' section has been updated with a link to a tool to help you check when you need to register for VAT for private school fees. Guidance has also been added for payments received by non-maintained special schools between 29 July 2024 and 29 October 2024.

  8. Details on how to attend webinars about VAT on private school fees have been added to the ‘Get more information’ section.

  9. The guidance has been updated to show private sixth form colleges will be affected by VAT changes on school fees. Information has also been added to show that affected education providers cannot include VAT on their invoices until they get their VAT registration number for school fee payments received from 29 July 2024.

  10. The 'Who must register for VAT' section of the guidance has been updated to show private schools, independent schools and sixth form colleges will need to check if they must register for VAT.

  11. Added translation

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