§ Mrs. Renée Shortasked the Chancellor of the Exchequer in what circumstances adult education courses are treated as entertainment and subject to value added tax; and if he will make a statement.
§ Mr. Bruce-Gardyne:The value added tax treatment of adult education courses, except where provided by schools and universities supplying exempt education, depends on the level of the charge made to the participants and the nature and content of the courses.
When provided free of charge or below cost, such courses are not subject to tax. When provided for profit, they are taxable.
If the fees are charged at cost, certain of these courses would be exempt from VAT, but sporting and recreational activities are excluded from this exemption unless provided as part of a general educational curriculum.
This has been the position since the beginning of the tax.
§ Mrs. Renée Shortasked the Chancellor of the Exchequer what is the practice of Her Majesty's Customs 47W and Excise in the treatment of educational courses for the purposes of charging value added tax; whether any guidelines exist with regard to adult or other educational courses; and, if so, if he will publish them.
§ Mr. Bruce-Gardyne:I would refer the hon. Member to my reply to her other question today.
The exemption from VAT follows the provisions of group 6 of schedule 5 to the Finance Act 1972. The law is quoted in Customs and Excise Notice No. 701 which contains explanatory notes giving guidance on the effects of the legal provision. Notice No. 701 is issued to persons registered for the tax and is also available at all local VAT offices.