UT/2023/000073 - [2025] UKUT 00101 (TCC)

The issue in this appeal is whether certain supplies of education made by the Appellants should have been treated as exempt for VAT purposes by virtue of Article 132(1)(i) of Council Directive 2006/112/EC (‘the Principal VAT Directive’ or ‘PVD’) and/or Group 6 of Schedule 9 to the Value Added Tax Act 1994 (‘VATA 1994’). It was common ground that Article 132(1)(i) is directly effective and that the Appellants are entitled to rely on it if the United Kingdom has failed to implement it properly; in particular if Group 6 is in breach of the principle of fiscal neutrality. In brief, the Appellants say that the domestic provisions do not properly implement Article 132(1)(i) and their supplies should be treated as exempt. In the alternative, the Appellants contend that their supplies are exempt under provisions in Group 6 of Schedule 9.

The Appellants were represented by Ms Nicola Shaw KC with Mr Ben Blades. Mr Raymond Hill and Ms Laura Inglis appeared for HMRC. We are grateful to counsel for their clear submissions, both written and oral, on behalf of the parties.

For the reasons set out below, we have decided that the Appellants’ appeals must be dismissed.