If dobbin 1 is really asking about instructing, rather than examining, then it would theoretically be possible for a school to act as agent for a self-employed instructor and not charge VAT to the student on the tuition fee, so that the instructor can avoid charging VAT, so long as he remains below the registration limit. But there are significant issues which would make anyone sensible pause for thought and then take advice before proceeding:-
1. It would have to be absolutely clear to the student that the school was acting as agent for the instructor. If not, then the idea is a non-starter as a result of s. 47(3) VAT Act 1994 which allows HMRC to treat the supply from an undisclosed agent as being
from the agent (the school) to the customer (student) anyway. So you can't do this without a lot of changes to the business model/documentation. How that might impact on the position vis a vis the CAA might be worth considering.
2. The whole arrangement would inevitably need to be structured rather artificially because the school does not work for nothing - it would still want its cut. There are two obvious ways of doing that. Either the school charges the instructor for the use of its facilities (plus VAT, of course) in which case the instrutor will want a bigger fee from the student, or the school charges the student a separate fee (plus VAT of course) for use of its facilities. Each route has VAT and other implications and complications.
3. Increased HMRC scrutiny is pretty much guaranteed. Expect in-depth enquiries and (just possibly) re-examination of the "self-employed or employed" issue for the school and its instructors. My concern here would be that HMRC might want to revisit that issue if a suitable case came along. At present schools can point to the Sherburn Aero Club case as a relatively recent decision that went in favour of self -employment for instructors, but it's not a strong decision. For those interested it is reported at
The Finance & Tax Tribunal
Finally, please bear in mind that the "advice" in this post is worth precisely what you have paid for it!