From the BBC:
Independent schools in England are protesting about "too narrow" rules for charitable status - as two out of five test-case schools fail to qualify. The loss of charitable status threatens tax benefits for independent schools (1). The Independent Schools Council says the rulings rely too much on the number of bursaries, with fees likely to have to rise to fund subsidised places. The Charity Commission says charities must "demonstrate how they bring real benefit to the public" (2).
The publication of the rulings is the latest stage in determining how fee-paying schools can retain charitable status. The refusal of this status for two of the first test-case schools - St Anselm's in Derbyshire and Highfield Priory, near Preston, Lancashire - has angered the independent school sector.
(1) Taking St Anselm's School, for example: it has 250 pupils, and its 2008 accounts show total income of £3,590,405 (average school fees £14,362 per pupil) with a group profit before tax of £352,468. If it didn't have charitable status, it would have to pay around £70,000 in corporation tax. So the price of telling the meddlers to piss off would be around £280 per pupil, which would free them from a lot of other admin and hassle as well.
(2) How can private schools, however expensive or snobby, not be of direct and immediate "benefit to the public", simply by dint of the fact that those pupils aren't asking for a tax-payer funded place at a state school? And don't forget that "[a]ccording to Lord Macnaghten, to be charitable, a trust must be either for:
• The relief of poverty;
• The advancement of education;
• The advancement of religion; or
• Other purposes beneficial to the community."
Is the Charities Commission seriously contending that this or any other school is not primarily for "the advancement of education"?
Of course, once I'm in charge, there won't be any tax breaks for charities, but the education vouchers will sure as heck be worth more than £280 per pupil.
Tuesday, 14 July 2009
From the BBC: