How to manage higher private school fees
Private school fees have soared following the addition of VAT in 2025, and further increases are likely as schools look to boost their finances. Here’s how to manage the higher costs.
Parents will be coughing up for private school fees ahead of the new term, but costs are rising.
The average cost of funding day school is currently £18,678 a year while boarding school costs £44,940 a year, according to the Independent Schools Council (ISC).
There are other costs to consider too, such as registration and entrance exam fees.
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Private school fees typically rise each year, but they have soared since January 2025, after the government introduced an extra 20% VAT charge on schools.
Independent school fees were 22.6% higher in January 2025 compared to the year before, according to the ISC. The rise takes into account other cost increases as well as the VAT policy.
Speaking to The Telegraph in August, Julie Robinson, chief executive of the ISC, said independent schools were facing “incredibly difficult financial headwinds”.
“Over the past two years, there has been a triple whammy of additional taxes – with VAT being placed on school fees, charitable schools losing business rates relief and the rise in National Insurance employer contributions – set against a backdrop of rising prices and falling pupil numbers,” Robinson added.
For parents, this will ultimately result in higher costs. Here's what you need to know to help you manage them.
How to cut private school fee costs and cover the bill
Some families are biting the bullet, considering private school to be an investment in their child or grandchild’s future.
The most recent ISC Census shows more than 96,000 new pupils were enrolled at private school in the 2025/26 academic year.
If you’re considering sending your child to an independent school or worried about ongoing fees, there are ways to cut costs and fund it properly.
Keep your options open
You might have your heart set on getting your child into a certain school, but being flexible in where they enroll could save you money.
The Good Schools Guide found day fees at London schools Thomas’s Kensington and Westminster School come in at £34,635 and £49,950, per year, respectively.
However, St Benedict’s in Ealing costs up to £26,769 while Blackheath High GDST Junior School costs up to £19,974. Both schools are in London. Private school fees outside of London tend to be higher too.
Alex Pugh, chartered financial planner at wealth management firm Saltus, said: “Private school fees vary enormously, so if you are keen to keep your child in private education but feel rising fees at your current school feel unsustainable, it is worth considering alternative schools in your area before assuming private education is out of reach all together.”
Bursaries and scholarships
A bursary is a grant that enables a child from a less affluent family to study at a private school.
They are generally means-tested, meaning you’ll only be able to get one if your family’s income and savings is at a certain level.
Pugh, from Saltus, said: “You may find that the school also offers discounts for siblings, as well as for children whose parents work in certain professions, including the armed forces.”
Meanwhile, scholarships are offered to pupils who have excelled academically, or in music, sport or art.
Each school will have its own fee assistance programmes, so you should contact the admissions department to find out if you’re eligible for help. Over one third of pupils receive fee assistance, according to ISC.
Ask grandparents for help
You could get financial help from your child’s grandparents – it can be a useful way to lower an eventual inheritance tax (IHT) bill as well.
Sarah Coles, head of personal finance at investment platform AJ Bell, said: “If they [grandparents] set up regular payments and keep good records, it can count as a regular gift from income, so it falls out of their estate immediately for inheritance tax purposes.”
This trick could come in particularly handy from April 2027, when unused pensions will be subject to IHT.
Consider a bare trust
A bare trust is a trust structure that can be set up by a parent or grandparent with the child or grandchild classed as the beneficiary.
In England and Wales, the beneficiary is legally entitled to the capital and income of the trust when they turn 18.
The advantage to bare trusts is that income and gains are classed as belonging to the child, so in most cases they fall into tax-free allowances.
If the grandparent or parent dies more than seven years after transferring assets into a trust, no inheritance tax is due on them.
For these reasons, bare trusts can be a useful vehicle to cover the cost of private school fees in a tax-efficient way.
Coles explained: “The money put in the trust counts as being given away immediately for tax purposes. Money left in the trust belongs to the child at the age of 18, but the trustees can access money before then, as long as it’s for the benefit of the child."
However, Coles warned: "If a parent pays into the trust and income is £100 or more a year, it’s taxed as belonging to the parent. It’s why it’s usually a more suitable option for gifts from grandparents, or where investments don’t produce income."
