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HMRC has issued a Revenue & Customs Brief in relation to its interim position which may impact education providers.

The Brief 39 (2014) outlines the VAT liability of goods or services that colleges of further education and other education providers supply to the public in the course of education, or vocational training, undertaken by students.

We provide a link to the relevant brief here: Brief 39

The brief follows on from the latest Upper Tribunal ('UT') decision in the Brockenhurst College ('the Appellant') VAT case.

The Appellant's challenge was that its supplies made from its restaurant (used for training chefs, restaurant managers and hospitality students) were VAT exempt supplies of education and not standard-rated supplies of catering. Additionally, that the tickets sold by its students for concerts etc. put on by its students are part of its educational courses and, again, should be VAT exempt.

HMRC's argument is that the supplies should be outside the VAT exemption relief relating to education. The reasoning given by HMRC is that the students were not the beneficiaries of the supplies, but only benefitted from making them.

The UT rejected HMRC's argument and agreed with the Appellant and First-Tier Tribunal ('FTT'). That is, the UT held that the supplies made by the Appellant were closely related to the VAT exempt supplies of education. The reasoning is because they enabled the students to enjoy better education and were a direct benefit to the students.

HMRC has appealed the UT decision to the Court of Appeal and the hearing is to take place on 16-17 February 2015.
Although HMRC has made no change to its current VAT policy (i.e. it is still deeming such supplies as outside the VAT exemption relief for education), it will consider retrospective VAT claims and make the relevant VAT repayments where the circumstances are in line with the UT decision.

Who is potentially affected?

  • Colleges of further education and other education providers which provide goods or services to the public in the course of education, or vocational training, undertaken by students.

How can VAT Services (Scotland) Ltd help you?

  • We can assist education providers by reviewing its retrospective VAT position and assisting in identifying if a VAT claim exists.

Contact us

Should you wish further information on the above, please do not hesitate to contact Gary using the details outlined below.


Gary Moore
Direct line 0141 636 9353
Mobile 07812 061 582
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