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Supporting independent schools with their vehicle requirements in 2025 and beyond
In 2025, independent schools face unique challenges and opportunities regarding their vehicle requirements. This article provides insights and practical considerations for independent schools to navigate these complexities effectively. The information is based on a recent webinar hosted by Lex Autolease, featuring experts from Tusker and Rivervale Minibus Limited.
Read time: 6 mins Added: 15/07/25
Webinar key summary:
- VAT and leasing vehicles: Recent changes announced to VAT mean that schools are subject to the VAT treatment seen in other organisations. When it comes to leasing cars, this change could be advantageous.
- Salary sacrifice schemes: These schemes offer significant savings and benefits for employees, particularly with electric vehicles.
- Minibus management: Ensuring safe vehicles, trained drivers, and well-planned journeys are crucial for effective minibus management.
- Driver licensing and safety: Understanding the different licensing requirements and ensuring driver fitness is essential.
- Risk management: Implementing comprehensive policies and procedures helps mitigate risks associated with vehicle use.
VAT and leasing vehicles
Ashley Barnett from Lex Autolease highlighted the financial benefits of leasing vehicles for schools. When leasing, schools receive invoices with a net element and a VAT component.
On commercial vehicles 100% of the VAT can be recovered. On cars, 100% of the VAT on service/maintenance and repair can be recovered and on cars where private use is available, 50% VAT recovery on the finance element. This would be an advantage compared to the position prior to the government changes.
Some organisations have differing VAT rules behind the scenes, but these would be for organisations subject to standard VAT and can result in significant savings. For example, on a £500 net invoice in respect of the finance element with £100 VAT, £50 can be recovered as well as full recovery on the service/maintenance and repair element on invoice. This recovery is beneficial for schools managing tight budgets.
Salary sacrifice schemes
Alison Argall from Tusker discussed the advantages of salary sacrifice car schemes, particularly for electric vehicles. Tusker, part of Lloyds Banking Group, has seen significant growth in this area. The scheme allows employees to exchange part of their salary in return for a taxable benefit through salary sacrifice, offering financial benefits and convenience. Key features include:
- financial savings: Employees save on tax and National Insurance contributions, VAT efficiencies (where standard VAT applies) and enjoy corporate discounts and corporate finance rates making the scheme cost-effective
- all-inclusive packages: The scheme covers servicing, maintenance, motor insurance, all replacement tyres, accident management, lifestyle protection and roadside assistance
- environmental benefits: A large proportion of the fleet consists of electric vehicles, supporting the government's Road to Zero strategy and contributes to customers’ ESR (Environmental Social Responsibility) objectives.
Minibus management
John Peterson from Rivervale Minibus Limited provided a guide to managing minibuses, focusing on safe vehicles, drivers, and journeys. Key points include:
- licensing and permits: Schools must understand the different permits (Section 19, PSV operators) and ensure compliance
- vehicle maintenance: Regular servicing, safety inspections, and daily checks are essential to maintain roadworthiness
- driver training: Drivers should receive proper training and obtain a licence. Regular checks will ensure they're fit to drive.
Driver licensing and safety
Jack Bond, also from Rivervale Minibus Limited, emphasised the importance of understanding driver licensing requirements and ensuring driver safety. Key points include:
- licensing types: Different licences (inherited D1, full D1, standard car licence) have specific requirements and limitations
- driver fitness: Drivers must be free from alcohol, drugs, and certain medications. Regular eyesight tests and taking breaks are also crucial
- vehicle checks: Drivers should perform daily and weekly checks to ensure vehicle safety.
Risk management
Implementing comprehensive policies and procedures is vital for managing risks associated with vehicle use. Key recommendations include:
- policies and procedures: Establish clear guidelines for vehicle checks, driver responsibilities, and emergency procedures
- risk assessments: Conduct regular risk assessments for journeys and make sure all drivers are aware of the procedures
- insurance and breakdown cover: Ensure all vehicles have suitable insurance and breakdown cover, with contact information readily available.
Conclusion
Supporting independent schools with their vehicle requirements involves understanding financial benefits, implementing effective management practices, and ensuring safety and compliance. By leveraging salary sacrifice schemes, maintaining vehicles properly, and training drivers, schools can optimise their vehicle operations and provide significant benefits to their staff and students.
For further details or assistance, independent schools are encouraged to reach out to their Lloyds Relationship Manager.
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Lloyds Banking Group is a financial services group that incorporates a number of brands including (Lloyds Bank, LEX, Tusker, Scottish Widows & Schroders). More information on Lloyds Banking Group can be found at lloydsbankinggroup.com.