Private schools in rates bills savings of £522m

TAXPAYERS ARE giving private schools a £522m subsidy on their business rates bills thanks to their controversial charitable status, new research has shown.

More than half of all 2,707 private schools in England and Wales are registered as charities and can receive rate relief of 80 per cent – including some of the most elite schools in the country, according to business rent and rates specialists CVS.

It estimates this lucrative tax perk means private schools will pay £634.3m in business rates out of a potential £1.16bn bill over the next five years, saving a whopping £522.3m.

But their tax break comes as local authority-funded state schools are charged business rates in full.

Research by CVS found that Eton College, which educated 19 former prime ministers including David Cameron, is among those offered the biggest relief under its charitable status, saving a mammoth £3.3m over the next five years.

Berkshire-based Eton will pay just over £821,000 out of a £4.m bill over the next five years.

Dulwich College in south London, whose alumni include former Ukip leader Nigel Farage, will only pay £787,000 out of its £3.9m five-year rates charge.

Mark Rigby, chief executive of CVS, said: “It cannot be right that council-run schools pay normal business rates, but 56 per cent of all private schools, using their charitable status, receive an 80 per cent discount.”

He repeated calls for a review of the business rates system, which he said must be made “fairer and more sustainable in the long term”.

Under the Freedom of Information Act, CVS asked all 347 councils in England and Wales to provide details of tax relief given to private schools.

It said 132 councils provided full replies, revealing that 586 out of 1,038 private schools held charitable status and were afforded mandatory business rates relief.

CVS estimated that 56 per cent of all private schools held charitable status.

The Department for Communities and Local Government said private schools seeking charitable status “must meet a robust public benefit test”.