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VAT on Educational & Vocational Training Services in Ireland

Posted: January 23, 2018 Comment: 0 Read: 296 times
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The VAT rules relating to training and vocational services changed in Finance Act 2015. The new rules commenced on 21 December 2015.


Previously there was an exemption for certain training services. The rules have been fundamentally changed.

Exemption for VAT on Training Services

The exemption from VAT for training services is now restricted to recognised bodies (as defined in legislation) who provide:

  1. Children’s or young people’s education, school or university education;
  2. Vocational training or retraining, including the supply of goods and services incidental thereto (excluding research services)
  3. Instruction in driving certain mechanically propelled road vehicles designed or constructed for carriage of (i) 1.15 tonne of goods or more; or (ii) more than 9 persons (including the driver)
  4. Tuition given privately by teachers and covering school or university education

To be exempt from VAT, a training provider will need to fall into one of the categories of a “recognised body” including:

  • a recognised school, a college or a university;
  • a public body;
  • a provider in receipt of Exchequer funds from a body specified in regulations.

Activities not regarded as exempt education or vocational training

Management consultancy services

Management consultancy services that consist of advice on the structure or operation of a company and seek to address deficiencies in or to improve the way organisations are managed or run. These services are provided primarily for the benefit of the organisation rather than those working in it. These services do not come within the scope of the education exemption and are subject to VAT. Management consultancy services can be distinguished from a management training course. A management training programme seeks to equip managers with the skills to manage others. A management training course which is delivered by a recognised body or meets the conditions set out at paragraph 4.1 (i.e. it is vocational in nature) is exempt from VAT.

Lecturing services

Where a professional service such as lecturing is provided to an educational institution, such a supply is not an activity capable of being covered by the term “education”. In such cases, the lecturer makes him/her self available to the education institute and provide services to the institute. It is the education institute who in turn provides the exempt education to students. The lecturing services do not constitute “education” as the term is understood for VAT purposes and are subject to VAT at the appropriate rate.

However, the exemption may apply in very limited circumstances. The Court of Justice of the European Union has held that where a recognised body makes available a teacher/lecturer to another recognised body, and the teacher/lecturer temporarily carries out teaching duties under the responsibility of that establishment, such a supply may be exempt from VAT on the basis that it is a supply of services “closely related” to education. Each of the following conditions must be met:

  • both the education and the placement which is closely related to it are provided by recognised bodies
  • that placement is of a nature and quality such that, without recourse to such a service, there could be no assurance that the education provided by the host establishment and, consequently, the education from which its students benefit, would have equivalent value and
  • the basic purpose of such a placement is not to obtain additional income by carrying out a transaction which is in direct competition with commercial enterprises liable for VAT.
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