Revenue queries school gifts-as-fees scheme

The Sunday Times (C)

March 27, 2005 – Siobhan Maguire and Jill Nesbitt

THE Revenue Commissioners have held discussions with a Dublin school that has abolished fees in favour of voluntary contributions that parents in turn can write off against tax.The John Scottus senior school in Donnybrook asks parents to donate between €900 and €1,700 per child for each of the three terms in the school year. Its junior school in Ballsbridge asks for contributions of more than €700 per term.

Parents who make donations are told by the school, a registered charity, that they can claim some of it back from the Revenue Commissioners.Michael Telford, principal of the senior school, said: “The school operates on a not-for-profit basis. There is nothing special or unique in what we are doing. Other schools receive donations which are eligible for tax purposes. Details of all charitable donations received by the school have at all times been notified to the Revenue Commissioners.”Tax officials have held a meeting with the school to establish whether the contributions are eligible for tax relief. A Revenue spokesman said that, while donations to charities including schools are eligible for relief, school fees do not qualify.The John Scottus school, which has 350 students, was established in 1986 by parents involved in the School of Philosophy, a movement developed in the 1930s in Britain that incorporates academic learning with philosophy. Its curriculum includes Greek, Latin and Sanskrit, an ancient language of India now only used for religious purposes.Parents of students at the secondary school were first told about the voluntary contributions in a letter from the board in September 2002. The school was said to be in “an impossible financial situation” with the cost per child per term estimated at €1,484, mainly because of small class sizes.It was proposed that school fees be abolished and parents make a contribution instead, a system already in place in the junior school. The school originally suggested that parents pay about €860, 5% higher than the then fees.The current school prospectus says: “By accepting voluntary contributions from parents, this allows PAYE employees to contribute the lesser sum, but each January they complete a Revenue form and we, the registered charity, receive the tax portion of the contribution. If you are other than PAYE you can contribute the larger sum and in January of each year, you keep the Revenue form and return this when doing your tax return. Revenue will then give the tax portion of the contribution back, directly to you.”One parent of a child who used to attend the school felt the contribution was really a fee under the guise of a donation. “I don’t know many parents who considered it voluntary,” she said.Telford said the contributions were in line with Revenue and Department of Education guidelines because there was no obligation on parents to pay. “There are a number of parents who do not make a contribution, and a greater number who contribute only a small amount,” he said.Brendan Tangney from Dartry, who has two children in the junior school, said he pays up to €600 a month by standing order to the school. “I have no problems making these voluntary contributions because of the education my children are getting,” he said. “If it means I have to pay more to have my children in a class of 15 rather than 30, then I will do that.“There is no pressure on parents to pay. There is a real mix in the school, from the very wealthy to those who don’t have a bean, but the education ethos is the same for everyone.”The principal said parents who paid nothing were not at a disadvantage. “We will continue to educate any child that enrols in the school irrespective of contributions being made. The means of the parents are not a factor in admission.”Finian McGrath, an independent TD, raised the issue of contributions to the school in the Dail earlier this month. He had been contacted by a number of parents and teachers who said they were concerned by the payment practice.Mary Hanafin, the education minister, replied that “voluntary contributions by parents of pupils in recognised primary schools are permissible provided it is made absolutely clear to parents that there is no question of compulsion”.She said: “Their collection should be such as not to create a situation where either parents of pupils could reasonably infer that the contributions take on a compulsory character.”The education department said schools can abolish fees and replace them with a voluntary contribution system, but must establish themselves as non-fee paying.

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