RepresentationalUK Private Schools Now Add VAT to Fees:Why the change? How will private school fees change? Potential consequences for private schoolsLegal challenges and future outlookThe UK government has introduced a fresh wave of value-added tax (VAT) on the already expensive school fees for private educational institutions. This new rule, which came into effect on 1 January 2025, will add a 20% VAT on private school fees, marking a significant change in how these schools charge.Previously, private schools were exempt from VAT on school fees, as education was considered a tax-exempt service.However, under the new regulations, VAT will now apply to all payments made for the January 2025 term onward. The average cost of private school fees, which currently stands at around £15,000, has already increased by 55% since 2003, according to the Institute for Fiscal Studies (IFS).

Source: The Times January 01, 2025 12:46 UTC