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13 December 2024 / Liz Brownsell , Kieran Smith
Issue: 8098 / Categories: Features , Charities , Education , Tax
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Charitable schools: the VAT effect

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With a raft of unwanted changes on the horizon, Liz Brownsell & Kieran Smith explore some of the options available to charitable independent schools
  • From 1 January 2025, independent school fees will be subject to 20% VAT. They will also face an increase in National Insurance contributions and the removal of business rates charitable rate relief.
  • There are a number of options which schools might consider as part of their strategy planning for these changes, including reallocating funds and restructuring their activities.
  • Careful planning and professional advice is highly recommended.

Charitable independent schools in England will soon face the challenge of having VAT applied to school fees effective from 1 January 2025, at the same time as an increase in National Insurance contributions, swiftly followed by the removal of business rates charitable rate relief, creating a perfect storm for the sector.

How to successfully navigate through these changes will no doubt have been dominating the agenda of most school bursars since the announcement of the

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