Cornwall College v The Commissioners for HMRC
Decision date: 11 August 2025
Neutral citation: [2025] UKFTT 969 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
Cornwall College, a VAT-registered further education corporation, appealed HMRC output VAT assessments arising from adjustments for 2014/15 and 2015/16. The central issue was whether EFA/SFA grants paid under non‑negotiable national funding arrangements and allocation with claw‑back amounted to "consideration" for supplies of education or vocational training. The First-tier Tribunal held it was bound by the Upper Tribunal decision in Colchester Institute v HMRC and therefore found the grants were not consideration; the appeal was allowed and the assessed output tax was not due. Parties may apply for permission to appeal within 56 days.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: medium
The Tribunal treated as binding the Upper Tribunal's reasoning that funding determined by a statutory/national formula and paid under standard, non‑negotiable agreements (including regimes that prohibit charging students and operate via allocations with end‑year reconciliation/claw‑back) does not constitute "consideration" for supplies of education or vocational training for VAT purposes.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment records that HMRC has reserved further arguments on the Consideration Point pending a Court of Appeal hearing listed for June 2026, and emphasises reliance on the binding effect of the Upper Tribunal decision in Colchester Institute; these remarks are ancillary to the binding ratio.