Tax tip: VAT and private schools

VAT and private schools.

Many private schools will be submitting VAT returns for the first time in 2025. HMRC has confirmed in its VAT Input Tax Manual at VIT32000 that it will subject to conditions allow private schools to recover some of the VAT incurred on expenditure prior to the date of VAT registration. The amount of VAT at stake may justify the time costs involved reviewing past expenditure and collating the relevant invoices to support the amounts claimed.

Within the capital goods scheme

To the extent that VAT incurred before the date of VAT registration was incurred on qualifying expenditure that is within the capital goods scheme the VAT position should be determined based on SI 1995/2518 Part XV. This could be relevant for example to qualifying capital expenditure on the acquisition construction refurbishment fitting out alteration or extension of...