Schools' charitable giving hits new record

17 December 2004

Schools with charitable status in membership of the Independent Schools Council now give away £3 in assistance with fees and other charitable benefits for every £1 they receive in tax benefits, the highest ever recorded, according to latest figures.

And these schools also pay back to the Government TWICE as much in irrecoverable VAT than the value of the tax reliefs resulting from their charitable status.

The figures come from a major four-yearly survey of member schools. More than 750 ISC charitable schools responded and the findings, published today, show that the schools: (figures from the 2000-01 survey in brackets)

• Received £99.2m a year (£84.5m) in tax reliefs from charitable status
• Gave away £302m (£198.1m) in charitable benefits, most of it - £276.3m - in assistance with fees
• Gave away, on average, 7.4 per cent (6.9) of their fee income in charitable benefits
• Paid £195.5m (£163.3m) in irrecoverable VAT on services and capital expenditure.

ISC general secretary Jonathan Shephard commented today: "ISC schools are major contributors to society in many ways. By educating nearly half a million children at no cost to the state they save the public purse £2bn annually.

"These latest figures show that their direct charitable benefit continues to increase. The £3 given away for every £1 of tax relief received has gone up from £2.30 only four years ago and £1.35 a decade ago.

"If you add to that and the general saving to the taxpayer the amount schools pay in irrecoverable VAT, it is clear that for every £1 schools gain in charitable tax reliefs they give back £25 to individual families and to the community at large.

"If there is any suggestion of subsidy here, it is ISC schools which are doing the subsidising."

The major source of tax relief for charitable schools is 80% business rate relief (£71.6m out of the £99.2m total tax relief). Other reliefs include interest tax (£6.9m) relief on donations (£7m) and on legacies (£4.3m)