Indirect Tax for Universities and Education & Training Providers
Many providers of education and training services around the world are providing and developing courses that can be taken online, without students ever physically attending lectures. As technology continues to develop, it is anticipated that this trend will become more widespread.
In certain circumstances, online courses may be provided at no extra charge; for example, universities sometimes offer online courses to students at no extra charge beyond the cost of university tuition. However, commercial providers of education and training services (and potentially universities in the near future) likely charge a fee for online courses, which may make these courses subject to VAT and makes VAT an important consideration for the education and training providers involved.
If online training courses and/or education services are provided to individuals located in VAT jurisdictions, providers of such services may have an obligation to register for VAT in each of the countries in which its students are located. Such an obligation would likely have an impact on the pricing of such courses. Many countries do have an exemption from VAT for education services. However, this exemption can be difficult to obtain and often comes with numerous conditions attached.
Deloitte’s team of VAT specialists can provide insightful information for U.S. based education and training providers regarding VAT issues affecting their businesses and transactions. We can assist you in exploring options for:
- Identifying when and where VAT is likely to be a consideration
- Negotiating with foreign VAT tax authorities and apply for VAT exemptions to avoid the need to register for, and charge VAT on online courses offered abroad
- Suggesting alternative methods of delivering services in order to comply with available VAT exemptions abroad
- Managing VAT compliance abroad when VAT does have to be collected and administered
Download the attached PDF to learn more about Deloitte's Indirect Tax – online training and education assistance.