The idea of VAT free flight training is obviously very appealing. It is however not quite as straightforward as it first appears for a number of reasons.
I am not an expert on these matters but the basic plan is :
A flight training organisation sets up as a charitable non profit making organisation. As such then any sales it makes are not subject to VAT (under current legislation. the difficulty is that any business has of course got to make a profit and the difficulty is persuading the authorities that all the costs normally associated with flight training should be borne by the charity. If this is not achieved then the "parent organisation" must stand the costs without access to any of the revenue. If at a later date the customs and excise were to deterine that the scheme dod not meet the requirements of the legislation then VAT would be deemed payable on the revenue and of course the flight training organisation would now find itself in a great deal of trouble financially.
I can see that there is possibly some scope for member owned organisations such as LAC to go down this route, but it is fraught with danger for most FTO's to entertain this route.
Can I suggest that a better route would be for everybody to write to their MP to ask for VAT relief to be granted on commercial flight training to bring us to a level playing field with our colleagues in Europe and to replace the relief that was given by the NVQ scheme.
Malcolm Dean
Head of Training
Multiflight