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HMRC internal manual

VAT Education Manual

Group 6 Item 3 Examination services services including school inspections: supplies direct to pupils

Supplies such as GCSE examinations are usually made direct to school pupils by the examination board, and any payment to the school on behalf of the pupil is a disbursement. In most cases the provider of such services will be an eligible body and the supply will be exempt under item 3(a) of Group 6 of Schedule 9 of the VAT Act 1994 (VATEDU15000).

However, there may be circumstances where the provider of the examination or assessment is not an eligible body. Exemption will still apply under item 3(b) where such a non-eligible body supplies examination services directly to pupils under the circumstances set out in VATEDU45500.

It follows that supplies are exempt to pupils who receive education that is either:

  • exempt by virtue of item 1, 2, 5 or 5A of the Group - for example, a pupil in an independent fee paying school; or
  • non-business - for example, a pupil in a local authority school.