St George’s Preparatory School in Boston, Lincolnshire, will shut down at the end of the academic year, citing financial strain following the introduction of VAT on private school fees.
The school, rated “outstanding” by Ofsted, is among the first in the independent sector to announce closure directly linked to the government’s new tax policy, which took effect in January. The VAT measure is part of a broader initiative expected to generate £1.8 billion annually by 2029/30, supporting public services, including state education.
In addition to the VAT burden, the school’s operating costs have risen due to increases in employer National Insurance contributions and the National Minimum Wage. The combined financial pressure has led to daily losses that the school describes as unsustainable.
Falling enrollment has also contributed, as fewer families opt for fee-paying education due to the higher cost base.
The decision highlights growing concern within the independent education sector over the impact of fiscal policy changes on private institutions’ viability. Support measures are being arranged for students transitioning to new schools and for staff facing redundancy.
The policy is currently under legal challenge, with critics arguing it may breach human rights and be discriminatory. The government maintains that the primary aim is revenue generation for public investment.
