VAT & School Fees

VAT & School fees Fees-Legal Guidance

Any queries about the below must be directed to your own experienced VAT qualified accountants or VAT lawyers.

Is VAT chargeable on tuition fees?

Yes. Assuming the VAT threshold is exceeded, under the Value Added Tax Act 1994 and HMRC’s published guidance in VAT Notice 701/30: Education and Vocational Training, tuition is standard-rated for VAT purposes.

We work with a range of organisations to deliver the best learning experience to our students. Some of these organisations may be VAT-registered and charge VAT, while others may not.

In cases where a zero rated supply (e.g. text book production) is combined with a standard rated supply (e.g. tuition), vat will apply to the standard rated proportion.

Where VAT is applicable, it will be included in the tuition fee.

Is VAT reclaimable on tuition fees?

No – VAT on tuition fees is not reclaimable.

The Value Added Tax Act 1994, Schedule 9 specifies the circumstances under which education services are exempt, and HMRC’s position is clear:

  • Private individuals funding tuition independently, cannot reclaim VAT.
  • Businesses (including schools or companies) paying for tuition on behalf of a student are also prohibited from reclaiming VAT.
  • Local Authorities may have limited VAT recovery rights under Section 33 of the VAT Act 1994, but in most tuition-related cases, recovery is not permitted.

It is a criminal offence under the Fraud Act 2006 and the VAT Act 1994, Section 72 to knowingly submit a false VAT reclaim.

VAT Breakdown on Invoices

In line with HMRC best practice for education providers and to prevent unlawful VAT recovery, we do not show VAT as a separate line on tuition fee invoices. All fees are quoted as “VAT inclusive” where applicable.

This is common practice among private schools and tuition centres and is supported by HMRC’s compliance recommendations to reduce the risk of incorrect claims.

VAT Breakdown on Invoices

In line with HMRC best practice for education providers and to prevent unlawful VAT recovery, we do not show VAT as a separate line on tuition fee invoices. All fees are quoted as “VAT inclusive” where applicable.

This is common practice among private schools and tuition centres and is supported by HMRC’s compliance recommendations to reduce the risk of incorrect claims.

Penalties and Enforcement

HMRC and HM Customs & Excise have significantly increased compliance checks in recent years, particularly targeting false VAT reclaims relating to educational services.

Under the Finance Act 2007, Schedule 24, penalties for incorrect VAT claims can be:

  • Civil fines of up to 100% of the VAT over-claimed and
  • Criminal prosecution, which results in imprisonment; and/or
  • Public naming and shaming under HMRC’s deliberate defaulters list.

In Q1–Q2 2025, HMRC reported that over 800 UK business owners were penalised for attempting to reclaim VAT on tuition fees. Sanctions included substantial financial penalties and prison sentences for deliberate fraud.