Do you reckon vat will genuinely be added to school fees?

I totally agree they should be, I just can't see it getting through the layers of people in high places with kids in private.

No because Beer Stormer has wrecked his election hopes by siding with the IDF and Hamas simultaneously and Reeves did a plagiarism so better vote Tory, right?

If the maj is in the 150+ territory I think they’ll do it pretty quickly along with ending non-dom status.

Both are pretty negligible in terms of raising taxes, but long overdue and easy quick wins in terms of throwing red meat to the left wing of the party, which I suspect will be needing it by then, as Sir Keir is drifting to the centre ahead of a GE, and he will need to placate them. 

I think it will happen. And the non dom thing. And anything else they can do which they don’t think will have a significant short term impact on govt finances. Ie there will likely be an update to the equality act and an update to gender pay gap rules.

i don’t know whether banning non doms will have a material negative impact on inward investment. Hopefully not

Yes.

I thought it would get kicked into the long grass but changed my mind. It's a real vote winner tbf.

I'm the governor of an independent school and in the sector we're all expecting it. 

I thought that SKS had already rejected the idea as may be challenged in Court if certain other Higher Education establishment are allowed to continue not to charge VAT and also coz a number of the public schools have threatened to end the voluntary co-operation agreements that they have with certain local state schools that currently allow free use of playing fields and other facilities and instead start charging for these so that their own school fees can be reduced to help offset the amount by which they will have been raised by the introduction of VAT!

In all likelihood most front bench labour folks will have their kids in, or lined up, for private schools.

But even if they do bring it in, it will be a massive own goal, as it will simply send those families like ours, who could/can only just afford private fees for our kids, into the state sector.

Dux is right, this is being priced in by the independent sector.

There is a 2018 report undertaken on behalf of the schools about the likely impact. Even making allowances that it was drafted for an audience with vested interests, the maths is quite eye opening.

As a former Governor of a private school and a present Governor of a state one I chuckle at the prospect of the state school staff having to cope with all those incoming parents with high expectations. 

The endgame will be a boom in demand for private individual tuition given by private school teachers in the evenings and weekends, similar to that received by Tony Blair’s kids back in the day. 

Most private schools allow prepayment of school fees (I think this used to be primarily used for grandparents to pay in advance, use of bequests etc). It is now being promoted as a way of getting ahead of the imposition of VAT. My kids' school allows prepayment for anything up to their entire schooling career (with built in inflation adjustments and trueing up if fees rise faster/slower than predicted). I imagine there will be a fair few parents who have the wherewithal to do this (I would probably prepay at least a couple of years if I can scrape together the cash as where else do you get a return of 20%?!) - especially at the types of schools Labour have a chip on their shoulder about... 

yeah anti-forestalling never happens

I mean in the great scheme of things who cares even if some dodgy geezers get around it in the short term

the noovs of 2034 are bang out of luck (if you think paying for a free thing is lucky)

Yep and grandparents are even now preparing to do this to help their inheritance tax planning. 
 

Interesting to hear a tax planning lawyer describing clients as dodgy geezers. 

Aren't you a tax lawyer? Anti-forestalling is a bit different from retroactive tax (and you kinda need to be in power to do it). 2034 assuming the Tories aren't back in power by then...

I don't think it's beyond the wit of man to shift a tax point where the explicit goal is abusive behaviour. Looking forward to all the litigation fees on top of the vat. Wah wah wah.

Agree it should be a vote winner. There will be loads of sob stories, though.

Nobody for whom it is a vote winner will give a sh1t about these sob stories.

I worry more than the taxation approach versus removal of charitable status will allow the tax to be avoided, with school income structured through donations (tax-free) rather than fees (taxable).

Yes paying for one’s grandchildren’s future education with money which has already been taxed at least once is highly abusive. 

Paying income tax and then paying VAT on goods and services is completely standard across the developed world. You know this right? 

It will happen and schools will simply cut back on capital spending and rely more on that being funded by donations from alumni.  Some of the bigger schools will also swallow the increase and subsidise costs with endowment income rather than investing it in facilities.  I assume the change will also enable schools to reclaim more VAT on inputs so it will be introduced with great fanfare and then barely mentioned again when it transpires that is raises £500 a year.

You mean the power to retrospectively charge tax on transactions? Good luck with that

It isn't necessarily retrospective.

Education is a continually provided service, so under current law VAT would arise when an invoice is raised, or when payment is received.

Existing prepayment schemes do not have a tax objective (they were largely set up in times of very low interest rates, so became a form of cheap financing for schools as parents/grandparents thought they'd rather get a nominal return on the money by paying up front). As you say, there is a "true-up" that allows the school to ask for more money (or, in theory, give it back) if the prepaid amount is not what the fees turn out to be in, say, five years' time.

So, under these current arrangements, the fee-payer is not really making payment. Rather, they are just lending the school a sum of money that approximates to the school fees. 

If the school were to commit to what the next (say) five years' of fees are going to be, and invoice the whole lot up front, and there was no right to top up, then that might look a bit more like payment actually being received, and a (final) VAT invoice being issued. That would require schools to take a view on inflation, of course.

This is just one way of looking at current arrangements and how they might be viewed in the new, non-exempt world. The elephant in the room is that the government might change the law. You might say that is retrospective taxation but, for the reasons set out above, that it not necessarily the case: it could bet that, under current law, the purported "prepayment" is not that at all.

And bear in mind that no private schools are going to put their head above the parapet and start marketing schemes to avoid VAT, simply to save one generation of fee-payers roughly 10-15% on the next few years' fees. That's why they are subtly pointing out that their existing prepayment schemes, based on existing law, may (or may not) have an advantage in a non-exempt world.

Yes paying for one’s grandchildren’s future education with money which has already been taxed at least once is highly abusive. 

Lols at this view of what taxation is. Bless.

School fee inflation over the last 25 years: 550%

CPI inflation over the last 25 years: 200%

The idea that parents can't afford a further 10-15% on school fees to pay VAT: 0%

The idea that this will lose votes, given that 6% of pupils are privately educated: 0%

Paying school fees 5 years in advance does seem rather blinkered, apart from to places that have massive property/endowed wealth.

Plenty of private schools have gone bust over the years, and with the VAT issue, it’s likely that a fair few more PDQ after it is introduced.

Thanks Gloria, that's a good point. It does raise the question though whether HMRC / the Government would actually have the will to run this argument and try and claw back these amounts. They suggested removal of VAT rather than charitable status because it was straightforward and this would turn into a similar debacle to the loan charge.   

Yes paying for one’s grandchildren’s future education with money which has already been taxed at least once is highly abusive. 

Abolish all private education.  All children deserve a good education, which many state school pupils will continue not to get as long as policy makers can swerve the state system and so have no incentive to fund the state system properly.  Make all children go to state schools and they'll all get better.  

Make all children go to state schools and they'll all get better.  

Lollers at that.  Another possibility is that they could all get worse, especially the more that left wing egalitarian ideals kick in.

Lollers at that.  Another possibility is that they could all get worse, especially the more that left wing egalitarian ideals kick in.

Yes maybe, but at least then there would be an incentive for the state/society to sort it out and improve things, just like there isn't today.

Lollers at that.  Another possibility is that they could all get worse, especially the more that left wing egalitarian ideals kick in.

Yes, I'm sure that when they get worse and Tarquin and Arabella don't get the education their father Sir Digby Fatface expects everyone will just sit around and look at each other and say "Oh well, there's nothing that can be done is there?".  

Yes, I'm sure that when they get worse and Tarquin and Arabella don't get the education their father Sir Digby Fatface expects everyone will just sit around and look at each other and say "Oh well, there's nothing that can be done is there?".  

You're probably right, as Tarquin and Arabella will just visit home on their school holidays from their overseas boarding schools.

In all likelihood most front bench labour folks will have their kids in, or lined up, for private schools.

I'm hardly Labour's biggest fan in this parish, but do you have any evidence for this Marshall?

Tarquin and Arabella’s parents won’t be affected as much as those of Darren and Carly. It’s the aspirational lower middle class strivers who will be hit. 
 

Another socialist victory against social mobility 

Tarquin and Arabella’s parents won’t be affected as much as those of Darren and Carly. It’s the aspirational lower middle class strivers who will be hit. 

Darren and Carly being sent to posh school through their Dad the builder not paying any tax.  Boo hoo.  My heart bleeds for them, poor mites.

The problem with social mobility is that it's a two way street.  For some kids and families to move "up", some have to move "down".  But nobody is prepared to let that happen, in this case rich posh people invoking Darren and Carly who they've not given a flying fvck about ever until it suits them.

Works for me.

Obvs, better to let some other country pick up the economic benefits of the money spent on by M+D on and in connection with their educashun, and not the UK.

"Arabella and Tarquin will have to go to school with their fellow children, not segregated by our wealth.  How shall we respond?  By sending them away so we hardly see them.  Excellent, good plan".

OK.

"Arabella and Tarquin will have to go to school with their fellow children, not segregated by our wealth.  How shall we respond?  By sending them away so we hardly see them.  Excellent, good plan".

Yes, good plan so that they'll mix with some of the brightest, wealthiest and best connected in the US, so they'll either get top jobs later in life or else at least marry well!

Imagine the new level of school entry competition.  People who are going to save £30k a year on school fees will gladly pay £30k to rent the house right next to the school to ensure the kids get in.  In fact some of them will buy the houses closest to the school and rent them to their mates so it becomes impossible for anyone living more than 100m from the school to get their kids in.

People who are going to save £30k a year on school fees will gladly pay £30k to rent the house right next to the school to ensure the kids get in.

I've already solved this problem in my plan for abolishing private education, which has been shared on ROFs passim.

Entry to schools is on a lottery basis with schools in a reasonable vicinity, with transport provided for all.  People would not be able to buy into a catchment area system.

The "market" in education currently operates such that one school of inbred toffs provides most British Prime Ministers and 7% of the population get most advantages in all areas of life that they continue to take opportunities from the other 93%, entrenching economic inequality as well as racial disparities.  Great market!  Bring on the unintended consequences.

Imagine the new level of school entry competition.  People who are going to save £30k a year on school fees will gladly pay £30k to rent the house right next to the school to ensure the kids get in.  In fact some of them will buy the houses closest to the school and rent them to their mates so it becomes impossible for anyone living more than 100m from the school to get their kids in.

Or just treat this money to fund a down-payment or a massive mortgage on a F.O. house in a top catchment area and as well as saving on school fees they'll likely pick up a massive capital gain later in life.

So much for creating greater equality!

Roger most won't even need to do that.  Instead of spending a couple of million on a new sports centre they'll do an extensive refurb for a million and that will cover the VAT on school fees for 100 or so pupils.

Who would seriously prepay for years also? What if your kid hates it/ is bullied horribly?

I think this is the expectation of many parents who send their kids to boarding school - it didn't do Grandpapa any harm, after all. It's what I am paying for, damn it!

Plz C soltion abv

That's just dreamy leftie idealism that in practice just won't work.

The upper and middle classes who can afford to live in mega-gaffs in the leafy suburbs or in home counties splendour and can afford private tuition and frequent school trips etc who are well connected and actually take a keen interest in their kid's education will still thrive at the expense of others and these types will inevitably find away around any of your attempts at social engineering on that front.

The upper and middle classes who can afford to live in mega-gaffs in the leafy suburbs or in home counties splendour and can afford private tuition and frequent school trips etc who are well connected and actually take a keen interest in their kid's education will still thrive at the expense of others and these types will inevitably find away around any of your attempts at social engineering on that front.

Private education, including private tuition, would be banned.  Taking an interest in your child's education would of course still be fine, but this may come as quite a shock to the mega-gaffed you've referenced, who often pack their kids off to boarding school FFS.

Love how all the private school loving posh boys on this thread are frantically coming up with reasons why abolishing would be practically hard to implement showing they've abandoned the moral / political argument already. 

Oh but it would be hard to implement

Is not a good reason not to do something that would massively reduce inequality for future generations. 

*stands next to Occam* 

OMG WHAT A GOTCHA.  IT'S NOT BANNED THEY JUST CAN'T DO IT IN PURSUIT OF ANY PROFIT!  

I'm sure all those private tutors doing it for **checks notes** income will crack on regardless.

Grammar schools are the worst of all worlds.

Siphen the clever kids not rich enough to already be siphened off to private school, and leave the rest of the state kids in PROPER sh1te schools.  Might benefit a small amount of bright and poor kids, but overall leaves the poor kids worse off than in a comprehensive system.

trouble is, you need SOME sort of prioritisation for the clever kids because they are going to be running things

in the current system the high needs low potential kids use most of the resource, leaving clever kids to flounder and creating a flow of bemused, deskilled graduates

The only Prime Minister we've ever had from a comprehensive school is Truss.

Amusing if true, but much more of a reflection on the state of politics than state education.

It is a bit of a gotcha. Virtually no school in England that anyone has ever heard of is a "for profit" school. 

"Private" schools in Finland offer the same education based on the national education plan, just like public schools. They ONLY get funding from the state and cannot charge fees. These "private" schools need government permission to operate.  They can't charge fees, rely on government funding, and need government permission to exist. They are not really private schools in the sense understood in most of the world, and certainly the UK.  Perhaps why there are also so few of them.  

If Eton couldn't charge any fees, had to do the same curriculum as the rest of the UK schools, and had to operate the same budgets I would be fine with Eton.

trouble is, you need SOME sort of prioritisation for the clever kids because they are going to be running things

SEN needs are one thing.

I'm fully in favour of mixed ability teaching outside of the SEN space.

Bright kids help less bright kids.  That's why syphoning them off either for private or grammar education is wrong.

YWTF - what are your views on home schooling? If you're wealthy enough to dedicate your time to educating your kids rather than going to work is that driving inequality? 

YWTF - what are your views on home schooling? If you're wealthy enough to dedicate your time to educating your kids rather than going to work is that driving inequality? 

Anyone who home-schools is a total fruitcake.  I've never met a parent who does it who isn't an oddball and kids who are homeschooled are the incels and mass shooters of the future.  School isn't just about education FFS.

If Eton couldn't charge any fees, had to do the same curriculum as the rest of the UK schools, and had to operate the same budgets I would be fine with Eton.

You mean if it was totally sh*t? 

Doesn't really answer the question - would you ban home schooling if you are banning private tuition (and if so should any form of education outside of that provided by the state be banned)?

Homeschooling is indeed for nutters.

SEN needs are one thing.

I'm fully in favour of mixed ability teaching outside of the SEN space.

Bright kids help less bright kids.  That's why syphoning them off either for private or grammar education is wrong.

This captures a number of the reasons why parents choose private education. SEN provision is HOPELESSLY under-resourced in mainstream state schools. Teachers addressing diagnosed and undiagnosed SEN kids in a class of 30ish is a bid drag on resources.

And they give ZERO fvcks about getting kids to anything above the minimum standard required. Once your child has shown they will get to the threshold for SATs or a pass at GCSE, they just don't care.

It isn't the job of bright kids to help out less bright kids in class. Mixed ability teaching would be a wonderful thing if teachers had the time and inclination to deliver a differentiated curriculum that caters for bright and less bright kids. But they don't.

Wot Gloria sed.

The main reason we chose private for our two from 12 to 16 (at the cheapest private we could find) was because they are both strongly on the autism spectrum. They would have got good results at a state I am sure as they’re lucky enough to be intelligent but would have been absolutely miserable with the noise, class sizes and general confusion of a large school. 
Primary schools are generally small enough they can manage and by 16 they will (I hope) have learnt better coping mechanisms so college will be doable but I strongly suspect that my daughter at least would have dropped out of mainstream schooling already if we hadn’t gone private. The school has been amazingly understanding and put in place measures that meant she can cope daily and actually wants to go to school. The state sector hasn’t got the ability to do the same.

Happy to admit this is a selfish view but also very happy to be selfish when it comes to my children’s welfare.

I am not interested in giving them a social advantage just in trying to make sure they don’t dread every school day. There are, I am sure, many parents like me.

Clergs: if there is a Labour majority government, it will go ahead. I don't think it will be nearly as big a deal as people think. There will be a chorus of tiny violins for the relatively small proportion of the relatively small proportion of the country that educates its children privately.

Perhaps parents in my position could pay state schools extra to fund SEN resources so the reasonable adjustments could be made (and their children make use of them) whilst being part of the state school?
They tend to need more staff time, set routines (same desk every time) somewhere to go ( supervised) when disregulating etc. all of this costs cash the state sector can’t necessarily afford. Could parents pay to get this within their state school or would this be considered going private by stealth?

Dunno, councils can't charge for statutory deliverables but maybe you could separate it out into sundries?

Gloria - Labour hasn't yet considered the orphans, local authority care kids and special schools. Your confidence is based on nothing.

Cookie - you always do that thing of accusing others of being precisely what you are and it's curious. Not that curious.

What proportion of privately educated children are in local authority care? I wasn't aware any were, tbh, but it must be tiny.

Independent special schools are largely funded by children on EHCPs. 

In either case, government will have to fund the VAT cost out of the additional revenue generated by VAT on school fees.