Derby College Group appealed against assessments raised by HMRC under section 73 of VATA 1994 related to government funding agency grants and whether they were ‘consideration’ for a supply of services (education and/or vocational training) provided free of charge to students.

The further education college specialises in vocational courses with the main aim of providing students with technical knowledge and skills to succeed in employment. It also provides non-accredited full cost and commercial vocational courses for local businesses.

The courses involved in this case were all considered educational and therefore in Item 1 of Group 6 of Schedule 9 of VATA 1994.