VAT on private school fees: what changed
Since 1 January 2025, private school fees carry VAT at 20%.
It was announced at the Autumn Budget on 30 October 2024 and applied from the following term. That timing mattered. It landed mid academic year. Families who had already chosen a school, accepted a place and budgeted for the year found the arithmetic changed underneath them in January.
Two things matter more than the headline rate.
The first is that boarding is included. HMRC guidance states that "all education and boarding services provided by a private school or connected person will be subject to VAT at the standard rate of 20%". For a day place, VAT applies to tuition. For a boarding place it applies to accommodation and meals as well. Boarding families absorbed the largest cash increase.
The second is that schools were not obliged to pass on the full 20%, and most did not.
What it actually costs now
The Independent Schools Council census counts real fees at real schools. Its 2026 report, published in June, covers January 2026 and is the first full picture of the policy in operation.
One thing to understand before reading the numbers: since VAT arrived, the ISC collects fees excluding VAT, so these are pre-VAT figures. Add 20% for what actually leaves your account.
Average termly fees, excluding VAT:
- Boarding: £14,980 overall, up 4.2%. Senior boarding £14,735, sixth form £15,601
- Day fee at a day school: £6,226, up 4.4%
- Day fees vary sharply by region, from £4,473 in the North West to £7,580 in London
The overall fee increase across schools completing both the 2025 and 2026 census was 4.4%, excluding VAT.
Read that against the headline. The tax rate rose by 20 percentage points. Underlying fees rose about 4%. Schools absorbed a large part of it, by cutting costs, drawing on reserves and reclaiming VAT on their own expenditure, which they could not do before.
That does not make it affordable. It does mean the common assumption that every bill rose by a fifth is wrong. It did not.
What is not charged
Not everything a school invoices is caught.
- Nursery education sits outside the charge
- Placements funded by a local authority under an EHC Plan are effectively unaffected, since the authority reclaims the VAT
- Goods and services closely related to education, other than boarding, remain exempt
Anti-forestalling rules caught families who tried to prepay. Fees invoiced or paid between 29 July and 30 October 2024 for a term starting on or after 1 January 2025 still attract VAT, charged on the first day of that term. Prepaying did not work.
What happened to pupil numbers
Numbers have fallen. Boarding has fallen hardest.
ISC schools taught 526,611 pupils in January 2026, down 3.5% in a year. Boarders dropped to 57,836, or 11.0% of all pupils, a fall of 5,199 pupils, or 8.2%, in twelve months. On the alternative measure, counting anyone registered for boarding at any point in 2025/26, the fall is 7.4%.
International families pulled back furthest of all. Pupils whose parents live overseas fell from 25,526 to 22,941, down 10.1%, now 4.4% of the school population. 93% of them board.
The ISC does not attribute this to VAT alone. It names VAT and tighter student visa conditions together as likely contributors, and is careful not to claim a single cause. I would read it the same way.
Where that leaves families
This is the part I would want to know if I were sitting on the other side of the desk.
Boarding rolls are down 8.2% in a year and overseas boarders are down 10.1%. A boarding house costs roughly the same to run whether or not the beds are full. That is real leverage. It is also uneven. Some houses are full and some are not, and nobody publishes which is which.
Be careful with the fee-assistance headline. Total support across the sector reached £2.1 billion, helping 183,705 pupils, but the composition has shifted. Support funded by schools themselves is £1.1 billion, which is 55.4% of the total, down from 72.7% the year before. Most of the growth came from local authority funding for pupils with EHC Plans. That is a rise in state money for special educational needs, not schools becoming more generous with bursaries. For an international family it changes almost nothing.
What schools do fund directly still reaches 150,735 pupils, at an average of £7,551 each.
So the honest position is this. There is more room to talk than there was three years ago, because some boarding houses have space they did not expect. There is not a general loosening of fee assistance. Which schools are under-subscribed changes term by term and is not something you can look up, which is where an agent who is in these schools regularly earns their fee.
Two practical points.
Ask what the fee includes, not what it is. Registration, deposits, kit, tours, insurance and exam fees sit outside the headline number and vary widely. And ask about fee assistance explicitly, because it is unevenly distributed and rarely advertised.
What to do next
If you are budgeting for a UK boarding place, start from post-2025 numbers, remember the census figures exclude VAT, and build the extras in from the beginning. Our fees and funding guide breaks down the costs. If assistance will decide whether this is possible at all, start with scholarships and bursaries. For a full year of costings on a football boarding place, see our guide to UK football boarding school costs.
Chris Woodburn is Co-Founder of Prestige Football Schools, a BBSN accredited agent and British Council certified counsellor. He has spent fifteen years placing international families in UK schools.
Sources: HMRC: applying VAT to private school fees and the ISC Census and Annual Report 2026.