Commentary

V4.142 Exemption for education—item 1 (provision of education by eligible bodies)

Part V4 Exemption, zero-rating and reduced rates

V4.142 Exemption for education—item 1 (provision of education by eligible bodies)

V4.142 Exemption for education—item 1 (provision of education by eligible bodies)

Item 1 exempts the provision of education and vocational training when provided by an eligible body, and (prior to 1 August 20131) for supplies of research when provided by an eligible body to another eligible body. Although the legislation refers to the 'provision' rather than 'supply' of education, the First-tier Tribunal has held that the expressions are synonymous:2

'The definition of a supply in s 5 VATA 1994 is somewhat all-encompassing, providing that it “includes all forms of supply, but not anything done otherwise than for a consideration”. The use of the word supply thus brings with it the requirement that something is done for a consideration. Section 31(1) VATA 1994 states that a supply is exempt if it is of a description specified in Schedule 9. So item 1 of Group 6 in that Schedule is exempting certain activities that have already met the wide definition of a supply, ie that they are provided for a consideration, notwithstanding that item 1 does not itself use that word.'

Thus the provision of education which is outside the scope of VAT cannot be exempt, since it does not pass the first hurdle of being a supply. However the decision in Colchester (see 'The basis for the education exemption in UK legislation' at V4.141 above) suggests that the provision of grant-funded education may be regarded as a supply for consideration, and thus fall within the scope of the exemption.

Meaning of 'education'

'Education' is

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