Is your child’s school place affected by Labour’s VAT plans? Get in touch: money@telegraph.co.uk
Middle class families are fleeing Britain and heading to Spain in a bid to save thousands of pounds on school fees ahead of Labour’s VAT raid.
One parent said the cost of sending their three children to central London private schools would rise to £100,000 a year under a Labour government and they could save £25,000 by moving to Barcelona.
Private school fees have rocketed in Britain in recent years and now average more than £18,000 a year according to the Independent Schools Council – double what the majority of private schools in Spain charge.
It has left parents exploring all their options, and with numerous councils declaring they have “very few or no” places in oversubscribed state schools, some have begun looking abroad.
One parent who has already bitten the bullet is Chris Lipscomb who has moved his family from Devon to Oviedo, Spain for cheaper school fees.
His 12-year-old daughter, Tsarina, is one 70,000 British students in Spain studying under the British educational system across more than 80 different schools.
“The choice of schools here is very good,” he said. “The majority of the pupils here are Spanish, it’s probably about 90pc who are of Spanish origin, and then you’ve got others who come from mixed parentage. It’s a nice environment and the teaching is high quality.”
Mr Lipscomb said: “You don’t have to be a rocket scientist to know that the Government is going to change, and I am sure it will change, even though the election hasn’t happened yet. The affordability of school fees has always been a bit of an issue.”
Rather than the £16,000 a year he was paying for his daughter’s school in North Devon, Mr Lipscombe is now paying around £9,000.
Now semi-retired, the former recruitment boss said: “It is significantly different. Also of course, property prices here are much much lower, phenomenally lower.”
‘£100,000 a year fees under Labour’
Another parent who is considering Spain among a number of European destinations is Claire*.
The mother-of-three had previously moved her children into state schools but found their development was stalling so decided alongside her husband, they would put all of their money towards paying for private schools to give them the best education possible.
“We are in the position where year-to-year, we look at whether we are able to afford the fees. We’ve been able to do it so far but it’s taking a huge pinch.
“We have three children all going to quite expensive central London schools and when you add VAT to that, we are looking at between £95,000 to £100,000 every year. Even if that is affordable, that is criminal.
“When you look at paying euros for a top international school anywhere in Europe, look at Paris or Barcelona, you are saving loads of money. We would save potentially €30,000-a-year (£25,477) depending on where we choose to relocate.”
Claire, who has asked to remain anonymous, said while most parents in her well-heeled neighbourhood don’t publicly discuss the idea, many privately are considering moving abroad.
“Many people in London have the ability to transfer with their job or they have dual citizenship somewhere. We would be able to relocate through my husband’s job who works in tech. I’ve talked to three or four other sets of parents who are also thinking the same thing. It’s definitely on the minds of people.”
She also criticised Labour’s policy arguing she and her husband could fund “two or three state teachers’ salaries from the taxes we pay every year”, adding: “I think that’s something people don’t like to talk about.”
She said: “With Labour coming in, you start to hear this ‘wealth redistribution’ rhetoric and that makes me very nervous because the rich people, and everyone in our neighbourhood even though they don’t consider themselves wealthy, are now the villains.
“And I don’t feel comfortable with this, with this rhetoric that’s being touted around, it doesn’t make me feel like this is a happy place to be.”
Kate*, a mother-of-four from Oxfordshire, said she was considering moving abroad for cheaper fees, saying the tax burden in Britain had become “oppressive” and a “Labour government would be the final straw”.
“We are beginning to think their future will be brighter outside of the UK,” she said. “Life feels increasingly unsustainable here.”
Kate, who has a British husband but originally comes from the United States, added: “There is a strong disdain in the UK for improving oneself, working hard and upward social mobility.
“My husband works for the NHS and we feel this policy will only increase the class divide. It is beyond comprehension how the UK can target children and families like this.”
Chris Black, financial planner at wealth manager RBC Brewin Dolphin, said Labour’s planned VAT levy was forcing parents to “undertake a holistic review of their finances”, adding the topic was at the “forefront of many clients’ minds”.
However, Gianpaolo Mantini, partner at wealth management firm Saltus, warned parents not to be “naive” and to make sure they were considering the wider picture, and not only the financial savings.
“It might work for some people but actually the reality of giving up friends and family in order to save some money on school fees, you might turn around and say ‘yes there is a higher cost’.
“If you’ve got connections in Spain or family members living in Spain that might be less of a downside, in fact that might be one of the reasons why they are doing this.
“But when making these decisions looking from a purely financial lens it is perhaps slightly naive because there are obviously going to be added impacts with regards to other family members missing social occasions, or only being allowed back in the UK for 90 days a year if you are going to be a non-tax resident.”
He added: “If you are moving because of work or work helps to relocate you, that’s a completely different financial position but moving abroad to try and save 20pc on VAT in the end might not be that much of a saving.”
John O’Connell, chief executive of the TaxPayers’ Alliance, said: “This policy is causing chaos before it’s even been implemented, with taxpayers worrying they’ll be left to pick up the pieces.
“Labour’s private school tax raid will decimate the independent sector and add unprecedented strain on state schools, meaning its revenue-raising potential will be limited at best.
“Starmer should abandon this policy before it’s allowed to do any more damage.”
*Names have been changed.
Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.
