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Private Dog Grooming Tutor Denied VAT Exemption

The categories of business that enjoy VAT exemption are highly restricted and any attempt to extend them is likely to encounter stiff opposition from HM Revenue and Customs (HMRC). That was certainly so in the case of a woman who provided private tuition in the skills of dog grooming.

The woman argued that her business benefited from a statutory VAT exemption that applies to private tuition in subjects that are ordinarily taught in a number of schools or universities. On that basis, she asserted that she was not obliged to register for VAT. She also sought a six-figure VAT rebate on the basis that she had in the past paid the tax in error. After HMRC took a contrary view, she appealed to the First-tier Tribunal (FTT).

Ruling on the matter, the FTT found that the courses she provided involved the transfer of skills and knowledge to students. The tuition was given privately in that she provided it on her own account and at her own risk. Her courses were educational and not purely, or even predominantly, recreational.

Her students were awarded qualifications by recognised educational bodies and she was able to point to 88 further education colleges in England that offer courses with a dog-grooming element. Of those, 57 offered dog grooming as a freestanding course that led to a qualification of some sort.

The FTT could certainly see force in her argument that dog grooming is commonly taught in further education colleges in England. HMRC accepted that 'schools and universities' include further education colleges. However, the statutory test required her to establish that dog grooming is ordinarily taught at a wide number of schools or universities in the EU.

In dismissing her appeal, the FTT noted that she had provided no evidence that dog grooming is taught in the UK anywhere other than in certain further education colleges in England. There was also no evidence as to the position in other EU member states. Although she was not required to conduct an exhaustive search of every school and university in every member state, some evidence in that respect was necessary for her appeal to succeed.

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