The ruling
Are independent further education courses VAT exempt?
Short answer
Further education colleges supply education VAT free because they are eligible bodies. An independent, profit-making provider is not, so HMRC treats its fees as standard-rated. After the St Patrick's ruling, a provider whose courses students would see as the same as those at FE colleges may be able to claim they were exempt. Separately, vocational training is already exempt to the extent it is funded by the Department for Education or a similar body.
Does the ruling cover further education?
HMRC's Brief 9 (2026) is addressed to alternative providers of higher or further education. One of the colleges in the case, St Patrick's International College, supplied Pearson HNCs and HNDs, courses that FE colleges also deliver. The comparison the Court of Appeal accepted was with supplies by eligible bodies, and FE colleges are eligible bodies.
So an independent provider running courses that mirror FE college provision, for learners who pay for themselves, may be in a similar position. How similar is the question a review answers.
Signs it may apply to you
- You deliver regulated qualifications that FE colleges also deliver, such as diplomas, access courses or HNCs.
- Your learners pay their own fees, or a good share of them do.
- You are VAT registered and have been charging VAT on those fees.
Funded training is a separate route
Vocational training ultimately funded by the Department for Education, an apprenticeship service account, or the equivalent bodies in Wales, Scotland and Northern Ireland is exempt to the extent it is funded, whoever supplies it. If you have charged VAT on funded training, that is an error in its own right and does not depend on the St Patrick's ruling. See funded vocational training.
When it probably does not apply
- Most of your learners are sent and paid for by VAT-registered employers, who recover the VAT anyway.
- You run short commercial courses with no real equivalent at FE colleges.
- You are a charity or not-for-profit that already qualifies as an eligible body, in which case your fees should already be exempt. See eligible bodies.
Mixed providers
Many independent providers run a mix: some funded learners, some self-funders and some employer-paid courses. If part of your income turns out to be exempt, you become partly exempt and the partial exemption rules decide how much input tax you can keep. That affects both any claim for past periods and your VAT position going forward. See input tax and partial exemption.
Sources
- Revenue and Customs Brief 9 (2026): GOV.UK
- St Patrick's International College Ltd & Ors v HMRC [2026] EWCA Civ 852: caselaw.nationalarchives.gov.uk
- VAT Notice 701/30, education and vocational training: GOV.UK