{"id":837729,"date":"2025-09-17T10:08:49","date_gmt":"2025-09-17T08:08:49","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=837729"},"modified":"2025-09-17T10:08:54","modified_gmt":"2025-09-17T08:08:54","slug":"private-school-fee-warning-for-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/lifestyle\/837729\/private-school-fee-warning-for-south-africa\/","title":{"rendered":"Private school fee warning for South Africa"},"content":{"rendered":"\n

Private schools across South Africa are warning of dire financial consequences if proposed changes to VAT rules are implemented.<\/p>\n\n\n\n

The Independent Schools Association of Southern Africa (ISASA) and leading schools like St John\u2019s College have stressed that the amendments will push up fees, reduce scholarships, and undermine access to quality education.<\/p>\n\n\n\n

Tshepo Motsepe, ISASA\u2019s Director of Legal, Policy and Government Relations, said the proposal amounts to a forced deregistration from the VAT regime<\/a>.<\/p>\n\n\n\n

Many schools currently reclaim VAT on expenses and commercial activities. If the rules change, they will no longer be able to do so and will be left carrying the costs themselves.<\/p>\n\n\n\n

\u201cThis will create quite an unfortunate situation where schools will have to bear the brunt of a VAT liability,\u201d Motsepe said<\/a>.<\/p>\n\n\n\n

That liability could be crippling. Schools may have to pay millions of rands back to SARS within 12 months, with the money coming directly from parents. <\/p>\n\n\n\n

\u201cSuch a VAT liability to be paid back, unfortunately, would have to come from fees,\u201d he said. This would also limit schools\u2019 ability to fund infrastructure and development projects.<\/p>\n\n\n\n

Uncertainty over how far back the liability could stretch is making matters worse. \u201cIn the draft legislative piece, they\u2019ve not given a date. So we could be talking as far back as 2011,\u201d Motsepe explained. <\/p>\n\n\n\n

Some schools are already calculating massive figures. \u201cOne school was talking around R400 million based on the infrastructure development and activities they\u2019ve engaged in over the past 20-odd years.\u201d<\/p>\n\n\n\n

Motsepe said many South Africans wrongly assume independent schools only cater for the wealthy. <\/p>\n\n\n\n

ISASA represents 900 schools across the country, accounting for just 5% of the total schooling system. <\/p>\n\n\n\n

He pointed to examples such as City Kids in downtown Johannesburg, which serves families in areas where the government has not built new public schools in decades.<\/p>\n\n\n\n

\u201cThe work they do is the same as what we\u2019ll find is being done either by St John\u2019s or St Stithians when they run community projects \u2013 and all of that money comes from the main activities and fees parents pay.\u201d<\/p>\n\n\n\n

Serious consequences for thousands of families<\/h2>\n\n\n
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St John\u2019s College<\/em><\/figcaption><\/figure><\/div>\n\n\n

Even South Africa\u2019s most prestigious schools provide scholarships that broaden access. \u201cHilton would offer scholarships, and there\u2019s a large proportion of young learners in elite schools in the country who are on scholarships,\u201d Motsepe said. <\/p>\n\n\n\n

Removing VAT benefits would directly threaten these programmes, as those who are donors and the schools that are ring-fencing money for scholarship purposes will now have to admit fewer and fewer children into these schools.<\/p>\n\n\n\n

In a letter to stakeholders, St John\u2019s College, one of the country\u2019s most established independent schools, has also raised alarms.<\/p>\n\n\n\n

Tina Playne, chair of council at the school, said the amendment would have serious financial and educational consequences for both St John\u2019s and the wider sector.<\/p>\n\n\n\n

\u201cSt John\u2019s College is a registered non-profit organisation. We receive no state subsidies and operate on a strictly break-even basis, reinvesting all resources into our students\u2019 education and well-being,\u201d she said. <\/p>\n\n\n\n

The school currently recovers VAT on expenses such as classrooms, infrastructure, security, IT equipment, transport, catering, and medical services. <\/p>\n\n\n\n

Without VAT registration, these costs would rise sharply. \u201cParents will ultimately bear the burden through higher fees or levies, threatening affordability and access.\u201d<\/p>\n\n\n\n

Playne also criticised the \u201cdeemed supply\u201d rule, which treats deregistration as if a school had sold its assets, creating an artificial tax bill. <\/p>\n\n\n\n

\u201cThis is a purely artificial liability, potentially running into millions of rand, despite there being no sale, profit, or change in use. This unfair burden would again fall on parents who had no part in historic VAT claims,\u201d she said. <\/p>\n\n\n\n

The Bill is set to take effect on 1 January 2026, leaving schools little time to adjust. \u201cThe suddenness of this measure risks destabilising independent education across South Africa, with serious consequences for thousands of families,\u201d Playne warned.<\/p>\n\n\n\n

On behalf of St John\u2019s, she said the school would call on Treasury and SARS to exempt independent schools from the deemed supply provision.<\/p>\n\n\n\n

She also called for continuing VAT registration for schools with mixed activities and delaying the changes at a minimum to allow proper consultation and planning.<\/p>\n","protected":false},"excerpt":{"rendered":"

Private schools across South Africa are warning of dire financial consequences if proposed changes to VAT rules are implemented.<\/p>\n","protected":false},"author":92,"featured_media":807396,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9876],"tags":[3796,22164,7438],"class_list":["post-837729","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lifestyle","tag-national-treasury","tag-st-johns-college","tag-vat"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/837729","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=837729"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/837729\/revisions"}],"predecessor-version":[{"id":837735,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/837729\/revisions\/837735"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/807396"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=837729"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=837729"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=837729"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}