Question to the HM Treasury:

To ask His Majesty's Government what, if any, provision is being made to allow independent schools which have a Combined Cadet Forces Unit to offset the associated costs against their VAT commitments.

VAT registered schools, like all VAT registered businesses, are entitled to recover VAT incurred on the goods and services they purchase and use in making taxable supplies. Costs relating to non-business activities cannot be recovered as input tax. There is no special provision to allow recovery of VAT incurred for non-business activities.

Where Combined Cadet Forces related costs also support the broader educational provision, schools may be able to deduct a portion of the VAT incurred on the associated costs.

HMRC has published guidance specifically for private schools, including how they can recover VAT on costs.