Drumduan School Shuts After Four Decades as VAT on Fees Squeezes Finances
Drumduan School, a Moray-based independent institution co-founded by Oscar-winning actress Tilda Swinton, will close its remaining kindergarten provision on 30 June 2025, trustees have confirmed — the latest casualty of the UK government’s decision to levy VAT on private school fees.
The school, situated near Forres, had operated for 40 years under an unconventional pedagogical model that eschewed traditional desks and examinations in favour of hands-on learning, from canoe building to cookery. Its upper and lower school had already ceased operation before this final closure was announced.
VAT Policy Cited as Key Financial Pressure
Trustees attributed the closure in part to the government’s introduction of 20% VAT on independent school fees in January 2025, a measure that has driven average private school fees 22% higher than in January 2024, according to the Independent Schools Council.
In a statement, Drumduan’s trustees noted that amid the ongoing cost-of-living crisis, the additional VAT burden had proved “harder for families to absorb” while simultaneously inflating the school’s own running costs.
In an attempt to remain viable, trustees approved a 20% fee increase from August 2024. Pupil numbers subsequently fell, further undermining the school’s financial position.
Legal Challenge Fails to Offer Relief
A legal challenge mounted by a coalition of independent schools against the removal of the VAT exemption was dismissed by the Court of Appeal in February 2025, extinguishing one potential avenue of relief for schools such as Drumduan.
The trustees stated: “This decision follows a careful review of financial sustainability and reflects the trustees’ responsibilities to govern Drumduan. Despite sustained efforts to secure alternative funding, we have not been able to establish the financial foundations necessary to continue. It was not a decision taken lightly.”
Wider Sector Strain
Drumduan’s closure is part of a broader pattern of financial distress across Scotland’s independent school sector since the VAT policy took effect.
Swinton, whose own twin children attended Drumduan, was present at the school’s final class concert. The closure marks the end of an institution that had drawn national attention for its distinctive teaching methods, including BBC Scotland coverage in 2017.
The trustees confirmed that individual support conversations and guidance on next steps would be provided to affected staff and families during the transition period.