The above HMRC brief announces the result of a Government Review into possible extension of the VAT exemption for further (FE) and higher education (HE).

In September 2012, the Government issued a consultation entitled ‘VAT: Consideration of the case to extend the education exemption to for-profit providers of Higher Education’ which invited comments on options that would enable for-profit providers of HE to exempt their supplies of HE where they exclusively provide this type of education.

HMRC advises that the number of responses was low, especially from for-profit providers, or potential providers, of HE. Overall, there was no overwhelming support for either of the options put forward. It was clear from the responses that businesses would prefer a solution that exempted both HE and FE training from VAT, and that there should, if at all possible, be a uniform basis of recognition of a commercial body as an eligible body, for both HE and FE.

No solution was found that was acceptable to the majority of the for-profit education sector, and which also met Government objectives. The Government has therefore decided not to make any changes at the present time.