Private school fees and VAT treatment of therapy services

In an important addition to their guidance on the VAT treatment of payments linked to private school fees HMRC have provided new notes and examples covering situations where pupils receive therapy services in addition to education.

The new section ‘Supplying special educational needs and disabilities (SEND) therapies and education’ notes that where services performed by registered healthcare professionals (such as speech and language therapists or educational psychologists) are provided by a school it will be necessary to determine who is making the supply and whether the services form part of a single supply of education or are a separate supply of healthcare. The guidance confirms that ‘qualifying supplies of healthcare are exempt from VAT as long as the primary purpose of these services is the protection maintenance or restoration of the health of a person.’