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HMRC internal manual

VAT Education Manual

Group 6 Item 5 vocational training: the Young People's Learning Agency (YPLA) and the Skills Funding Agency (SFA): examples of contracts: previous treatment of payments

Some years ago, where the Learning and Skills Council (LSC) contracted for education, vocational training and examination services to be provided to its specifications and requirements, the payments by the Learning and Skills Council were regarded in each case as consideration for an exempt supply to the Learning and Skills Council.

Thus exempt treatment applied to programmes such as:

  • Work-Based Learning for Young People (comprising four elements:

    • Modern Apprenticeship,
    • NVQ training,
    • Preparatory Training, and
    • Life Skills);
  • Life Skills and Work Based Training; and
  • Modern Apprenticeships for the 19 plus

Where providers supplied the training and examinations elements of Investors in People (IiP) and these were not part of a broader package of taxable IiP services, the supplies were exempt from VAT.

Now the LSC has been replaced by the Young People’s Learning Agency (YPLA) and the Skills Funding Agency (SFA) and the majority of their payments are outside the scope of VAT: as discussed in VATEDU58500, they do not represent consideration for a supply.