VAT on private school fees: what changed, and what do parents pay now?
Since 1 January 2025 independent school fees carry VAT at 20%. What it applies to, what it does not, what happened in the courts, and how to compare fees fairly.
Since 1 January 2025, fees for education and boarding at private schools carry VAT at 20%. Registration fees are included; nursery classes made up almost entirely of children under compulsory school age are not. The government expected fees to rise by around 10% on average, but each school decided how much to pass on, so compare the price each school now charges, VAT included.
What exactly changed in January 2025?
Private school fees used to be exempt from VAT. Government guidance on applying VAT to private school fees says that from 1 January 2025 "all education and boarding services provided by a private school or connected person" are subject to VAT at the standard rate of 20%.
Families who tried to pay early did not escape it. The same guidance says fees paid on or after 29 July 2024 for terms starting on or after 1 January 2025 are also subject to VAT.
A second change followed in April 2025. Schools in England with charitable status lost their business rates relief, under section 5 of the Non-Domestic Rating (Multipliers and Private Schools) Act 2025, for financial years from 1 April 2025. That is a cost to the school rather than a line on your bill, but it is one reason schools gave for fee rises.
Which charges carry VAT, and which do not?
HMRC's guidance on charging VAT on goods and services related to private school fees settles most questions parents ask:
Registration fees that must be paid for a pupil to attend are subject to VAT, the same as normal fees. Extra-curricular activities that are educational in nature are subject to VAT. Meals charged separately are normally a different supply, and their VAT treatment can differ, so ask the school.
Nursery classes that are wholly, or almost wholly, made up of children below compulsory school age remain exempt. If your child is in a school nursery, ask whether the school treats it as exempt; the answer can differ from the Reception fee in the same building.
My child has an education, health and care plan. Does VAT apply?
It depends who pays. Where a local authority names a private school in a child's education, health and care plan and funds the place, VAT is due on the fees but the government guidance says local authorities can reclaim it from HMRC. Where parents pay privately, including for a child with special educational needs who has no plan naming the school, VAT applies to their fees.
So how much more are parents paying?
There is no single answer, and that is the point most coverage misses. VAT is 20% of the price the school charges, but schools set their own prices. The government's own impact estimate expected fees to rise by around 10% on average, because it assumed many schools would absorb part of the cost. Some schools passed on the full 20%, some less.
The tempting mistake is to take last year's fee and add 20%, or to compare a fee list that excludes VAT with one that includes it. Compare the termly fee each school publishes now, including VAT, and check what it includes: lunch, trips and exam entries are often extra. Our analysis of what higher fees buy in university outcomes is one way to think about value.
Is the VAT charge going to be overturned?
Not on current evidence. Families and schools challenged the policy in court. The High Court dismissed their claims in June 2025, in ALR and others v Chancellor of the Exchequer. On 27 February 2026 the Court of Appeal dismissed the appeals ([2026] EWCA Civ 170). Plan on VAT staying in the fees.
Frequently asked questions
Can I avoid VAT by paying fees in advance?
Not for terms from January 2025: fees paid from 29 July 2024 for those terms are subject to VAT. For future years, read any fee-in-advance scheme's terms carefully, because the school charges VAT as the law stands when the scheme is set up.
Does VAT apply to bursaries?
Ask the school how VAT is shown on a reduced fee. What matters is the amount you are actually asked to pay, VAT included.
Do state schools charge VAT?
No. State schools do not charge tuition fees, so there is nothing to charge VAT on. Our state vs independent tool sets the two side by side.
This guide explains the rules. It cannot tell you what a particular school will charge next year or how it will treat a specific extra; only the school's own fee schedule can. Our figures for each school show the fee year and whether VAT is included, and say so when a fee is not held.
The useful number is not the VAT rate but what school costs your family from now until your child leaves at 18, year by year, with fees as each school publishes them.
See what school would cost your family →Evidence level
From HM Treasury and HMRC guidance on GOV.UK, the Non-Domestic Rating (Multipliers and Private Schools) Act 2025 and the Court of Appeal's judgment of 27 February 2026, checked on 13 October 2026. Fee rises at individual schools vary and are not estimated here.
References
- HM Treasury and HMRC. (2024). Applying VAT to private school fees ↗ external. gov.uk
- HMRC. (2026). Charging and reclaiming VAT on goods and services related to private school fees ↗ external. gov.uk
- HMRC. (2024). Revenue and Customs Brief 8 (2024): removal of VAT exemption for private school fees and boarding fees ↗ external. gov.uk
- UK Parliament. (2025). Non-Domestic Rating (Multipliers and Private Schools) Act 2025, sections 5 and 6 ↗ external. legislation.gov.uk
- High Court (Divisional Court). (2025). ALR and others v Chancellor of the Exchequer [2025] EWHC 1467 (Admin) ↗ external. judiciary.uk
- Court of Appeal. (2026). R (BYL) v Chancellor of the Exchequer [2026] EWCA Civ 170, approved judgment ↗ external. judiciary.uk
Related research
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