Beta This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

VAT Education Manual

Local authority (LA) schools: Education Act 2002

It is unlikely that the conditions in VATEDU65750 will be met in respect of purchases made using payments that the governing body has obtained in connection with broader community services for which it charges.

Examples of services provided for under the Education Act 2002 include:

  • provision of sporting and crèche facilities;
  • ICT access;
  • adult education; and
  • various services currently provided by local authorities (should local authorities opt to contract them out).

Consequently, when this income is the property of the school rather than being paid into a delegated budget, and when it is then used to purchase goods or services, the local authority cannot recover any of the VAT. This VAT will be a cost borne by the governors, and it will only be recoverable to the extent that the governors are registered for VAT and they are making taxable supplies in the course of business.