Claiming
How might a claim work out for HNC, HND and English language providers?
Short answer
These examples use invented figures. They are illustrations, not real clients. They show how the same rules can give one provider a sizeable net claim and another a smaller or riskier one, depending on who the customer was, what input tax comes off and which route to exemption applies. The second example shows what waiting until 2028 could cost.
1. A private college teaching HNDs to its own students
A London college teaches Pearson HNDs to students who enrol and pay it directly, and charges VAT on fees. Its VAT-inclusive fee income is £1.2 million a year, so it accounts for £200,000 of VAT a year. It recovered £30,000 a year of input tax on costs linked to those courses. It makes a protective claim in October 2026, so the four-year window starts in October 2022.
| Period | Months | VAT on fees | Input tax off | Net |
|---|---|---|---|---|
| October 2022 to December 2023 | 15 | £250,000 | £37,500 | £212,500 |
| January 2024 to September 2026 | 33 | £550,000 | £82,500 | £467,500 |
| Total | 48 | £800,000 | £120,000 | £680,000 |
What the college should weigh up: the whole claim depends on the St Patrick's ruling surviving in the Supreme Court. The part from 2024 carries extra legal risk. HMRC is likely to test unjust enrichment, so the college's evidence that it competes on price with VAT-free FE colleges matters a great deal.
2. What waiting until 2028 would cost the same college
Suppose the college waits for the Supreme Court and claims in October 2028 instead. Its claim can then only reach back to October 2024.
| Net claim for periods | Claim in October 2026 | Claim in October 2028 |
|---|---|---|
| October 2022 to December 2023 | £212,500 | Out of time |
| January 2024 to September 2024 | £127,500 | Out of time |
| October 2024 to September 2026 | £340,000 | £340,000 |
| Total | £680,000 | £340,000 |
Waiting halves the claim for these periods and loses every period before 2024, which are the ones with the clearest legal footing. Periods from October 2026 onwards can be added in either case, as long as each is claimed within four years. See why claim now.
3. An HND delivery partner teaching for an FE college
A private company teaches HNDs for an FE college under a subcontract. It invoices the college £900,000 a year plus £180,000 VAT. It recovered £20,000 a year of input tax on costs linked to that teaching.
| Per year | Amount |
|---|---|
| VAT charged to the college | £180,000 |
| Input tax linked to the teaching, no longer recoverable | £20,000 |
| Net amount per year | £160,000 |
| Net amount over four years | £640,000 |
What the partner should weigh up: the college is an eligible body making mainly exempt supplies, so it probably could not recover much of the VAT it paid. HMRC is likely to argue that the college bore the cost, which makes the pricing terms of the subcontract important. HMRC can also be expected to test whether the St Patrick's ruling reaches teaching supplied to a college rather than to students. Any repayment may need to be agreed with the college. This is exactly the kind of arrangement the free consultation looks at first.
4. A pre-sessional English provider
A provider teaches pre-sessional English for a university's international students and also runs a pathway programme. Students pay £600,000 a year including VAT for pre-sessional English, so £100,000 of VAT, and £150,000 including VAT for the pathway programme, so £25,000. Its input tax is £40,000 a year: £10,000 on costs used only for the pathway programme, £5,000 only for English and £25,000 on shared costs.
| Per year | Amount |
|---|---|
| VAT charged on English teaching that may have been exempt | £100,000 |
| Input tax on English-only costs, no longer recoverable | £5,000 |
| Shared input tax no longer recoverable (82% exempt share) | £20,500 |
| Net amount per year | £74,500 |
If the provider supplied the English teaching to the students itself, the existing rule for commercial English as a foreign language may apply whatever the Supreme Court decides. If it invoiced the university for the teaching instead, the position needs checking against the agreement. The pathway programme stays standard-rated in this example. If the St Patrick's route applied to it too, the figures would change and the provider would become almost fully exempt.
These are illustrations
Real claims turn on the detail of your courses, your agreements, your VAT periods and your costs. Take advice before acting on any figure here, or book a free online consultation.