Vocational schools and VAT

[Allwrong]

A couple of crucial points that this doesn’t highlight: a) vocational arts schools are not the intended target of this tax, but are collateral damage in what is intended as a reform of strictly academic funding, so therefore should be excludedand b) the numbers affected are tiny, so making an exception would have negligible financial impact.

[Peanut68]

On 31/07/2024 at 22:10, Pas de Quatre said:

Local dance schools over the VAT threshold have always had to register and pay VAT (see my previous post), exactly the same as your local plumber.

So dance classes & things like yoga/music if offered by someone trading over the VAT threshold typically are already charging VAT? I’ve never seen a VAT amount being listed anywhere! Does this include gym lessons too? Am wondering if this is another reason for the ever growing expectation for staff in schools & gyms to operate as Freelancers to thus avoid adding VAT (as individual teachers possibly remain under threshold for their total billings) also saving on HR costs like holiday/sick/maternity/

paternity/compassionate leave pay etc etc   

[Peanut68]

On 31/07/2024 at 21:49, Kerfuffle said:

There has just been another article on Sky to do with abuse at private ballet boarding schools. 

Anyone got info/link to this as I’ve not heard of this (don’t have Sky) 

[glowlight]

2 minutes ago, Peanut68 said:

So dance classes & things like yoga/music if offered by someone trading over the VAT threshold typically are already charging VAT?

I think they would have to charge VAT if over the threshold, but VAT threshold being turnover of £90,000, most local dance schools probably don't reach that level of turnover. 

 

The expectation for staff in schools in gyms and schools to be freelance may be to do with VAT, if you pay the freelancer directly. But if you pay the school/gym it wouldn't help with their VATable turnover, in which case I think you are right that it's more about employment legislation. Not just eligibility for sickness, maternity, holiday pay but also entitlement to redundancy.

[The red shoes]

Just now, glowlight said:

I think they would have to charge VAT if over the threshold, but VAT threshold being turnover of £90,000, most local dance schools probably don't reach that level of turnover. 

 

The expectation for staff in schools in gyms and schools to be freelance may be to do with VAT, if you pay the freelancer directly. But if you pay the school/gym it wouldn't help with their VATable turnover, in which case I think you are right that it's more about employment legislation. Not just eligibility for sickness, maternity, holiday pay but also entitlement to redundancy.

I think you’d be surprised just how many larger local dance schools now have to add VAT!! 

[The red shoes]

8 minutes ago, Peanut68 said:

Anyone got info/link to this as I’ve not heard of this (don’t have Sky) 

 

9 minutes ago, Peanut68 said:

Anyone got info/link to this as I’ve not heard of this (don’t have Sky) 

I can’t add a link for some reason but if you google “ Sky news abuse in ballet schools” there is an article from 27th July. Quite an in depth one 

[Jan McNulty]

32 minutes ago, Peanut68 said:

Anyone got info/link to this as I’ve not heard of this (don’t have Sky) 

 

Google is your friend ... it was published about a week ago.

 

I googled "sky news article about abuse in ballet schools uk" and it came up as the top item.

[Pas de Quatre]

30 minutes ago, glowlight said:

 

The expectation for staff in schools in gyms and schools to be freelance may be to do with VAT, if you pay the freelancer directly. But if you pay the school/gym it wouldn't help with their VATable turnover, in which case I think you are right that it's more about employment legislation. Not just eligibility for sickness, maternity, holiday pay but also entitlement to redundancy.

There is also NI employers contribution, and now I believe employers have set up pension schemes and contribute to these alongside the employee. 

[Jan McNulty]

You have to register for VAT if your turn over is greater than £90,000 per annum - it is more complex than that but this is it in simple terms.

 

https://www.litrg.org.uk/working/vat-when-running-business#3

[Peanut68]

I’ve often thought it is partly to avoid this VAT registration & the no doubt additional accounting headaches/costs that leads some of the more ‘local dance schools’ etc to almost limit their business ambitions & so they don’t run as many classes/offer extras like private lessons/rent out studios etc as they could. 
 

I wonder how it works if certain elements remain as a Charity? For instance, I know of a school where the studio is actually owned by a charity but for the sole use of the dance school….no idea of set up but I imagine there’s sone sort of repairing lease/rent paid etc 

 

[Jan McNulty]

11 minutes ago, Peanut68 said:

 

I wonder how it works if certain elements remain as a Charity? For instance, I know of a school where the studio is actually owned by a charity but for the sole use of the dance school….no idea of set up but I imagine there’s sone sort of repairing lease/rent paid etc 

 

 

 

Charities are not exempt from VAT.

[Legseleven]

The letter is great but it doesn’t make it clear that there is NO state provision of vocational ballet schools in England, Wales and Northern Ireland. - just as there is NO state provision of academically selective schools for academically gifted children except for the few areas which still have grammar schools. 
 

it isn’t a question of choosing a private education for children who are gifted, whether in ballet, music or academically - it’s simply that parents should be able to choose to sacrifice what they feel is appropriate to help their gifted children to have an education which will maximise their potential, without having VAT added because of a government’s ideology (sorry, because the government believes it will be a huge benefit to state schools). 

Edited August 2 by Legseleven

[taxi4ballet]

50 minutes ago, Legseleven said:

The letter is great but it doesn’t make it clear that there is NO state provision of vocational ballet schools in England, Wales and Northern Ireland. - just as there is NO state provision of academically selective schools for academically gifted children except for the few areas which still have grammar schools. 
 

it isn’t a question of choosing a private education for children who are gifted, whether in ballet, music or academically - it’s simply that parents should be able to choose to sacrifice what they feel is appropriate to help their gifted children to have an education which will maximise their potential, without having VAT added because of a government’s ideology (sorry, because the government believes it will be a huge benefit to state schools). 

I suppose the major difference between academic private schools and dance schools is that the government funds places at the dance schools via the MDS scheme. Those parents on the lowest income would have their dc's fees paid in full. If they are going to implement VAT on those fees, then they need to either exempt MDS-funded places from VAT, or increase MDS funding to cover it. 

[Kerfuffle]

I think the fact that you get a full fee MDS  if you’re on a small income undermines the argument that poorer kids would miss out. Private school parents on fairly modest incomes might get by on a bursary or scholarship in a similar way and they also face an increase in fees.There are ways of getting into training at post 16, which doesn’t involve private  schooling - CAT dance schemes are funded based on parental income. 

[Kerfuffle]

The letter is great but it doesn’t make it clear that there is NO state provision of vocational ballet schools in England, Wales and Northern Ireland. - just as there is NO state provision of academically selective schools for academically gifted children except for the few areas which still have grammar schools. 

Comprehensive schools can provide execellent education for academically gifted children. I know many kids studying medicine and at Oxbridge from ordinary state schools. 
 

I don’t think that you have  to go to a vocational ballet school to become a professional ballet dancer under the age of 16. 
 

 

[Raquelle]

12 hours ago, Kerfuffle said:

 

The letter is great but it doesn’t make it clear that there is NO state provision of vocational ballet schools in England, Wales and Northern Ireland. - just as there is NO state provision of academically selective schools for academically gifted children except for the few areas which still have grammar schools. 

Comprehensive schools can provide execellent education for academically gifted children. I know many kids studying medicine and at Oxbridge from ordinary state schools. 
 

I don’t think that you have  to go to a vocational ballet school to become a professional ballet dancer under the age of 16. 
 

 

I agree with you Kerfuffle in theory....

 

but it really does depend on where you live. Geographically there are areas in the country where you can freely access CAT schools or access high level vocational training, perhaps similar to what you would access in ballet school.

 

However, there are no CAT schools within a 2 hour radius of where we live. There are no local ballet school offering 'vocational training', so living at home my dd would not have access to regular pointe work, pas de deux, rep, etc. There are only recreational training schools in our area/country! Most associate schemes are 1.5 to 2 hours away and they only provide some of the training you'd need. 

 

For us, losing our mds place (due to a fee increase) would mean losing the opportunity to pursue ballet and letting go of the dream 😢 

[Kerfuffle]

Hi @Raquelle I can see that you have a very difficult situation, maybe the vocational school can offer you a bursary? Is the increase of 20% added to the amount you pay or the whole fees? 
 

I think successful non vocational students dance every evening (my daughter did), often join associates (we drove 3 hours to ours) and maybe get involved with a youth  ballet to get pas de deux experience and maybe a CAT scheme (we didn’t have a ballet one near us). At upper school pas de deux starts from scratch and variations on pointe are built up slowly so you don’t have to be very experienced at these. I guess all of this does depend on geography and the family’s over all set up (how many kids you have etc, if your work is flexible). We were lucky to have good schools near us and great teachers but it did take a while to get the right mix. 
 

 

[glowlight]

I am not directly impacted by this, but from the outside looking in I perceive that the biggest impact here will be on students already at the schools who are not currently supported by MDS or bursaries. For the parents of these students who have carefully budgeted for their child's education, they now find themselves with a 20% increase of costs with virtually no notice. The impact here is the potential interruption to the child's education, especially during GCSE years, and if I was one of these parents I would be petitioning my MP for some sort of phased approach so that these students are protected.

 

This is completely separate to the question of whether it is right or wrong to apply VAT on vocational private schools.

 

 

 

 

[Peony]

I’d like to know how many ballet students are getting in to RB, ENB, BRB having only started vocational at 16? Particularly how many girls? Families who can fund loads of lessons, travel time etc are also pretty privileged. 
quite rightly this thread is about ballet but there are also 100000 children with SEN in mainstream private schools. Many there  because they’ve been failed by state schools, social care, health services. There’s also a large amount of service families boarding. People support this policy without really understanding other peoples’ situations. It’s not going to save money, it’s ideological and is about the politics of envy. Private schools are big income generators for the government, I wish we would stop attacking education, we need people to be well educated!

[Kerfuffle]

I know quite a few girls who have studied at those schools without previous vocational training including my DD. I  guess you are referring to Elmhurst rather than BRB? I paid far less money for my daughter’s training than if she had been to vocational school. I  don’t think all those students now in upper schools from state school backgrounds were particularly privileged. I don’t consider myself envious but I do think that the playing field could do with being levelled - if you look at the statistics for privately educated judges, journalists, politicians, musicians, award winning actors etc you’ll see how state educated are underrepresented. Everyone deserves to be well educated not just those who pay for it. 
 

 

[Peony]

49 minutes ago, Kerfuffle said:

I know quite a few girls who have studied at those schools without previous vocational training including my DD. I  guess you are referring to Elmhurst rather than BRB? I paid far less money for my daughter’s training than if she had been to vocational school. I  don’t think all those students now in upper schools from state school backgrounds were particularly privileged. I don’t consider myself envious but I do think that the playing field could do with being levelled - if you look at the statistics for privately educated judges, journalists, politicians, musicians, award winning actors etc you’ll see how state educated are underrepresented. Everyone deserves to be well educated not just those who pay for it. 
 

 

I was referring to getting into the companies, not the schools

 

The vast majority of kids at private are not becoming judges and politicians. I’ll think you’ll find that those very few go to very specific schools and come from very privileged backgrounds. And VAT will have absolutely no impact other to make the schools even more elitist. 
 

If your child has a decent state school available (which often coincides with living in more expensive areas), parents funding extra curricular (plus a ballet school with enough lessons at the correct level) and spending huge amounts of time taking them to lessons and they have the right brain type to be able to cope with that of course they are privileged. Some kids need vocational because they don’t have that available. If a child is talented enough they should be able to go to vocational school, that’s the whole point of the MDS scheme

[Kerfuffle]

I don’t know any private school parents who would make those sacrifices if there wasn’t some kind of advantage in doing so! 

If a dancer can get into an upper school and hold their own when around those who have been to vocational school then surely they have as good a chance of getting into a ballet company? 

These days with intensives/private lessons seeming to be part of getting a place at year 7 are we really talking about raw potential any more? 
I think it’s horrible for those parents suddenly facing a huge increase in fees, especially in GCSE years. I hope that the schools come to the rescue for this cohort or some arrangement is made for them. 

Edited August 3 by Kerfuffle

[Allwrong]

Many private academic schools often are simply perceived as gentler environments to be in, which attracts many parents.

However the most prestigious are academically selective, and for scholars’ houses much more rigorously so than the comparatively  lame Oxbridge entrance procedures, and so they ought to be churning out high achievers, just as one would expect in the dance world for the most highly selective dance schools.
Except that if you are fortunate with where you live you may get a very similar experience in a free state school. See Harris Westminster 6th form for example, or other less well known ambitious state schools which have very selective streaming or entrance.

 

The difference, surely, is that you can get a top rate academic education for free (if you are lucky), or one good enough to achieve highly (with ability and work). But, MDS aside, the same is not true for dance. Even Kerfuffle’s cheaper options are scarily expensive. So the extra 20% VAT for those who have been chosen as the very best is particularly brutal. Which is why vocational dance schools should be exempt. In fact, there is a pretty good case for the training to be free, as I believe is the case in some other countries ?

[Kerfuffle]

I would never describe what we spent on dance education as scarily expensive, it was considerably cheaper than what we would have spent with an MDS at a boarding school. What I’m trying to explain is that with adequate talent students from non vocational can reach the same standards without  attending boarding school. If the main argument against VAT being charged is that all talented dancers can’t be successful without a private ballet education this isn’t actually true. 

[taxi4ballet]

8 hours ago, glowlight said:

I am not directly impacted by this, but from the outside looking in I perceive that the biggest impact here will be on students already at the schools who are not currently supported by MDS or bursaries. For the parents of these students who have carefully budgeted for their child's education, they now find themselves with a 20% increase of costs with virtually no notice. 

I think the biggest impact will be felt by the parents of those young dancers whose training is fully-funded by MDS due to low income. How can any of them possibly afford to pay the VAT? White Lodge fees next year are just over £38k before VAT is added. So the parents on the lowest incomes would have to find the best part of £8,000 out of thin air to pay the VAT. How could they possibly afford to do that? 

 

People who are already able to find £38,000 a year for their child's fees are probably going to be able to tighten their belts and find the extra 20%. It would be a struggle, but they could do it at a push.

 

The same does not apply to the fully-funded. Their parents are probably struggling to pay their electricity bill, let alone anything else. Their belts are already as tight as they can go.

[Kerfuffle]

Surely those full fees students wouldn’t pay 20% of fees that they are exempt from paying ?  That is crazy. I thought it was on the amount they already pay. 

[Peony]

33 minutes ago, Kerfuffle said:

I would never describe what we spent on dance education as scarily expensive, it was considerably cheaper than what we would have spent with an MDS at a boarding school. What I’m trying to explain is that with adequate talent students from non vocational can reach the same standards without  attending boarding school. If the main argument against VAT being charged is that all talented dancers can’t be successful without a private ballet education this isn’t actually true. 

it comes back to the question how many dancers at enb, RB and Brb began vocational training at 16, coming from a background of local classes/ associates? 
 

If you look outside major cities and grammar schools how many schools are providing music, choice of foreign languages, arts subjects, high level sport? Many people need to pay to get those things. They pay to avoid bullying (which can be a problem for male dancers especially), they pay for SEN support because the EHCP process now takes years. In some areas there’s no need to pay because state schools are good but that’s certainly not true in many places and it’s hardly ‘levelling up’ when it’s the more well off parents who are able to rent and buy homes near the better schools.

[Kerfuffle]

I can’t tell you company statistics but I can tell you that non vocational get into the upper schools, ENBS and RBS included. It’s not easy but with determination and talent it is possible . They develop as well as any of those who have had expensive boarding school. It’s very hard to balance the demands of a regular school with after school lessons in dance so that grit pushes them on. 
State education can be good in the countryside, there are often fewer private options so there is less of a “braindrain” than in a city. More kids from varying backgrounds mix. 
 

[alison]

And in one case probably a couple of decades back: some friends of mine had a child who was highly allergic to, I think, peanuts.  They approached all the local state schools to check whether they would take all the necessary action to keep their child safe: supervise their meals to make sure they didn't get any peanut-containing food, teach all staff with whom the child was likely to come into contact to use an epipen, and so on.  The responses in all cases were unsatisfactory.  These friends were distinctly left-leaning, and it went against everything they believed in to choose private education, but when the private school said Yes, certainly, we can do all that and also ... they decided that they couldn't risk their child's life for a principle.

[Chira]

9 hours ago, taxi4ballet said:

those young dancers whose training is fully-funded by MDS due to low income. How can any of them possibly afford to pay the VAT? White Lodge fees next year are just over £38k before VAT is added. So the parents on the lowest incomes would have to find the best part of £8,000 out of thin air to pay the VAT. How could they possibly afford to do that? 

Students on an MDS won’t have to pay a 20% increase, it is the schools who will have to absorb the increase from their own budgets. (as they do now). The income thresholds set by the government won’t change.
What it will mean going forward is that vocational schools are likely to have far fewer MDS places available, fewer bursaries and fewer scholarships.

 

Thus by default creating institutions where only wealth and privilege can prevail. 
 

 

[Kerfuffle]

I don’t understand why fewer MDS places, there hasn’t been anything to suggest this  - this is a pot of money like  DaDa given by the government to help with funding. Labour are highly unlikely to change this - Keir Starmer is very appreciative of the arts and has been a member of Guildhall conservatoire junior department. His parents were not rich, they were working class so would have qualified for scholarships. I think it means that the part paid depending on your income  would increase - but that also depends  on the individual school and whether they can make cuts in other ways so that the parents don’t take on all the extra costs. There are several articles about how schools intend to limit the increase to parents to much less than 20%. 
 

Edited August 4 by Kerfuffle

[glowlight]

11 hours ago, taxi4ballet said:

I think the biggest impact will be felt by the parents of those young dancers whose training is fully-funded by MDS due to low income. How can any of them possibly afford to pay the VAT? White Lodge fees next year are just over £38k before VAT is added. So the parents on the lowest incomes would have to find the best part of £8,000 out of thin air to pay the VAT. How could they possibly afford to do that? 

 

Although it isn't clear how the VAT will work for MDS students, I can't see parents being charged VAT if the rest of the fees are paid by MDS. I imagine that either MDS subsidised places will be exempt from VAT, or the government will increase the value of the MDS to cover the VAT portion. This may lead to fewer MDS being available, but I expect this would impact new MDS's awarded, not those who already have MDS. I appreciate I'm veering into the conjecture here, but I don't think the government will use this new tax to hit very low income families.

11 hours ago, taxi4ballet said:

People who are already able to find £38,000 a year for their child's fees are probably going to be able to tighten their belts and find the extra 20%. It would be a struggle, but they could do it at a push.

 

It may be controversial to suggest this, and I agree that some will be able to, but some won't. Some families already make huge sacrifices and get into debt to pay their children's fees to dance school. 

[taxi4ballet]

3 hours ago, Chira said:

Students on an MDS won’t have to pay a 20% increase, it is the schools who will have to absorb the increase from their own budgets. (as they do now). The income thresholds set by the government won’t change.
What it will mean going forward is that vocational schools are likely to have far fewer MDS places available, fewer bursaries and fewer scholarships.

 

Thus by default creating institutions where only wealth and privilege can prevail. 
 

 

Well if there is VAT to pay on places fully funded by a government scheme set up to ensure that people on a lower income can access those places, then surely it is the government who either has to pay the vat as part of the MDS, or they should decide to exempt them, so MDS funded places don't have chargeable VAT in the first place.