VAT-free Musical Instruments for School Children
Students at Local Education Authority (LEA) maintained schools are eligible to purchase instruments without paying VAT if they are either:-
- Having weekly musical instrument lessons from a school or LEA employed teacher
- Studying toward GCSE or A level music, or
- A member of a school or LEA orchestra, with fees (if applicable) being paid to the Local Authority.
How to go about purchasing your instrument VAT-free through Sheehans depends on whether your school is:-
Within Leicester and Leicestershire...
For students in the Leicester and Leicestershire areas who qualify for the scheme, we keep all of the necessary forms here at Sheehans. Once these forms are filled in and payment has been made, the instrument can be taken away and we will process the rest of the paperwork for you.
Our preferred method of payment is by cheque as this can be made out directly to Leicestershire County Council, although we can also accept credit cards (with a £5 surcharge), debit cards and cash. Leicestershire Arts in Education charge a small fee (currently £13.50) for processing each application which is added to the cost of instrument when payment is made.
Note: to qualify, you must be either:
- Having weekly musical instrument lessons with a school teacher or a peripetetic teacher employed by Leicestershire Arts in Education, or
- Bringing the instrument into school on a weekly basis for GCSE or A-level music study*, or
- A member of a Leicestershire Arts in Education band or orchestra, or
- A member of a school or LEA orchestra, with fees (if applicable) being paid to the Local Authority.
*Local Education Authority schools only.
Outside Leicestershire...
For students at LEA schools outside Leicestershire, you should first find out if your LEA runs an assisted purchase scheme, by contacting the school or the LEA directly. If they do, ask for a copy of the forms you will need.
If not, it may still be possible for your school to reclaim the VAT on the instrument, providing the guidelines below are adhered to. Your school will have to purchase the instrument on your behalf, reclaim the VAT and then sell it on to you. It is up to the school to decide whether or not they are willing to do this.
Students of independent schools do not normally qualify unless they are a member of a Local Education Authority band or orchestra with fees (if applicable) paid to directly to the LEA.
Assisted Instrument Purchase Scheme - Government Guidelines
The following text is taken from a document entitled "The Assisted Instrument Purchase Scheme - a Guide for Parents and Schools" published by the Music Industries Association, and approved by HM Customs and Excise.
Introduction
The Assisted Instrument Purchase Scheme enables pupils having music lessons at LEA-maintained schools to purchase musical instruments without paying VAT.
This guide is designed to explain the scheme's rules and procedures to both parents and schools, with the intention of helping as many pupils as possible to benefit.
How does the Scheme Work?
- Once the parent/pupil has chosen an instrument and supplier, they should ask the school to place a formal order with the instrument retailer.
- The parent pays the school the ex-VAT price for the instrument.
- The retailer supplies the instrument to the school.
- The school can reclaim the VAT on the instrument in the usual way. (Local authorities are refunded any VAT they incur in delivering their non-business statutory activities).
- The school then gives the instrument to the student.
What are the Rules?
The general conditions that the student and school must comply with to benefit from the scheme are as follows:
- The student must be at an LEA maintained school.
- The School (or LEA) must place an order for the instrument, take delivery and be invoiced (enabling them to recover the VAT).
- The transaction between the student and school (or LEA) must take place on school (or LEA) premises in a room that is normally used for teaching.
- The instrument must be appropriate to the student's needs and ability.
- The instrument must be portable and taken to school (or LEA premises) on a regular weekly basis for use during lessons (from either the school or local authority's education department).
- The LEA must sell the instrument to the student at or below cost.
- Pupils of independent schools would not ordinarily be able to benefit from the scheme - unless the student receives regular tuition from the local authorities music service.
Operation of the AIPS Scheme
The onus is on LEAs to ensure they comply with all VAT legislation and that all AIPS sales are transacted correctly according to the rules stipulated. For this reason, the operation of the scheme may vary slightly from area to area in order that individual LEA's internal controls are complied with.
In most instances, schools order directly with suppliers but, in some LEAs, the Music Service or a dedicated administration function deals with all AIPS transactions centrally. In such instances, your school or music teacher should know how to take advantage of the scheme.
In addition, some LEAs make a small administration charge to parents for processing the transaction, which obviously involves an amount of work for their school and education finance department.