British Army Assesses VAT Impact on Military Families' Private Education

The British Army is currently assessing the potential impact of Value Added Tax (VAT) changes on military families' ability to afford private education. This consultation comes in response to the UK government's plan to impose a 20% VAT on private schools starting January 1, 2025, ending their long-standing tax exemption.

The Army has initiated a survey, asking service personnel to share their views by September 23, 2023. This move acknowledges the crucial role private schools play in providing stability for children of military families, who often face frequent relocations due to service requirements.

Currently, approximately 4,700 children from military and diplomatic families receive government support for private education through the Continuity of Education Allowance (CEA). This allowance can cover up to 90% of boarding school fees, aiming to minimize educational disruptions for children of serving personnel.

However, the CEA has remained frozen for several years, with a cap of £9,080 per term for secondary schools. This amount falls significantly short of average boarding school fees, leaving many military parents to contribute substantial sums out of pocket.

"We provide CEA to eligible officials and service personnel, which is in recognition of the enormous sacrifices our military families make and the fact that they are often required to move base location. The allowance ensures that we can limit disruption to the education of serving personnel's children."

The government's decision to apply VAT to private schools has faced growing opposition. A legal challenge has been launched in the High Court, arguing that the policy discriminates against children with special needs. In response, the government has proposed exemptions for children with the most complex special needs, specifically those with Education and Health Care Plans (EHCPs) or equivalent support in Scotland, Wales, and Northern Ireland.

This situation highlights the complex interplay between education policy, military family support, and tax regulations. The British Army, established in 1660, has long recognized the importance of educational stability for service families. Similarly, the UK's VAT system, introduced in 1973, has evolved to address various sectors of the economy.

As the debate continues, private schools have begun announcing fee increases starting January 2024, with many opting to absorb part of the 20% tax for two terms after its implementation. This move aims to mitigate the immediate financial impact on families.

The government maintains that ending tax breaks for private schools will help fund educational priorities, including the recruitment of 6,500 new teachers. However, the potential consequences for military families and children with special educational needs remain a subject of ongoing discussion and legal scrutiny.