I am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the VAT Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within categories of goods and services specified in the Directive in respect of which Member States may apply a lower rate or exempt from VAT. In accordance with the Directive the provision of vocational training services is exempt from VAT. Vocational training and retraining covers training directly related to a trade or profession as well as training aimed at acquiring or updating knowledge for vocational purposes.
The VAT exemption may apply to pilot instruction, such as pilot lessons that are provided in the manner of recurrent vocational training as required to maintain a recognised pilot qualification.
For training or retraining to be exempt from VAT, each of the conditions set out below must be met:
- It must be vocational in nature; that is, it must be directed towards an occupation and its associated skills
- It must be provided to improve the vocational rather than the personal skills of the trainee
- The vocational skills that the trainee acquires can be transferable from one employment to another, or to self-employment
- The training will generally be provided by means of a structured programme, have concise aims, objectives and clear anticipated outcomes
- There should be a clear trainee/trainer relationship between the student and the teacher or instructor.
Where any of the above conditions are not met or the course is primarily directed towards personal development or undertaken for recreational purposes, the course will be subject to VAT at the appropriate rate.
Further information on the VAT treatment of education and vocational training is available on Revenue’s website at www.Revenue.ie
