Academy field trips to museums, exhibitions, countryside parks and the seaside are common ways of enriching the curriculum.
The trip is normally regarded as educational and therefore part of the core curriculum activities, such that any funding is generally made as a donation or voluntary contribution, as a compulsory payment for core educational activities cannot be requested.
This supply is therefore one that is closely related to education, if it is not education in its own right, meaning that it qualifies as part of the non-business activities of the academy.
|VAT Registered||Not VAT Registered|
|Income||Outside the Scope (no VAT)||-|
|Expenditure||Reclaim as Input Tax||Reclaim (VAT126)|
Activity Type: Non-Business
Points to Note / Treatment for Subsidiary
Field trips would not normally be operated by a subsidiary, but some ancillary supplies may be considered to be outside of the core educational activity, such that the subsidiary or another entity (e.g. PTA) may become involved.
Such supplies will need to be considered in their own right to establish the VAT treatment, as they are unlikely to be treated as the delivery of non-business education.
In some instances the school trip will be purchased as a package from a tour operator. There are special VAT rules, called the "Tour Operators Margin Scheme" (TOMS), that apply to such travel packages and mean that VAT will not be charged in the normal way and thus cannot be recovered. It will be important to check this before calculating the amount to charge pupils.
Any VAT or sales tax incurred on purchases made abroad cannot be directly recovered from HMRC, but in some instances VAT registered academies can reclaim this VAT from the overseas tax authority using an online process facilitated by HMRC.
Technical & Reference Material
- HMRC Notice 701/30 "Education and vocational training" - section 8.2 confirms school trips are "closely related" to education.
- HMRC Notice 723A "Refunds of VAT in the European Community for EC and non-EC businesses" - covers overseas VAT recovery.