39% of UK parents will ‘definitely’ or likely have to withdraw their children from private schooling should Labour win the next election and impose 20% VAT on independent education, research has found.

Based on current ISC/IFS figures, this will push 242,000 children into the state education system and could wipe out £3.98 billion in fees paid to UK private schools

The research was carried out earlier this year on 1,000 UK parents with children in private education in the UK and was commissioned by finance advisor Ashbridge Partners.

Nearly 15% of parents’ plan to move their children into state education as early as after prep school. Almost one in ten parents say that moving their child into state education will mean the money they save on VAT will be enough to afford to move their children back into private education later on in their schooling for GCSEs or A-levels.

Nearly a third will have to remortgage their home (30%), and more than one in 10 will be forced to sell their property (11%) or take a second job (16%). A handful of parents said they would have to rent out their spare room to cover the extra cost while around 30% are speaking to a finance adviser for help.

London and the Southeast were some of the worst affected areas by Labour’s proposal. One in five parents in both regions will ‘definitely’ have to remove their children from private education should Labour win the next election, while nearly a quarter (23%) of parents in the Southeast will need to take another job to cover the additional costs.

Families nationally have said that cutting back on ‘extras’ will be a necessity with 39% cutting back on school trips, and a quarter planning to cancel or reduce family holidays. 15% will look to trim their household bills, one in ten will downsize the family car, and 6% will reduce pension contributions. The picture was much higher in some regions with more families in the Southeast (40%), Northeast (48%) and Wales (50%) planning to reduce school trips, with well over a quarter in the south west (30%), Yorkshire (34%) and Midlands and Wales both (28%), cutting down their spend on family holidays.

An overwhelming 97% of parents are not planning to pay school fees upfront, even though this could protect them against a rise in school fees. Half of these parents (50%) said the reason was because they are unable to afford this option, which was the same for London and the Southeast, while 15% of UK parents would rather ‘risk it’ and see if Labour gets into power.

Mark Ashbridge, founder of Ashbridge Partners said: “It is surprising how few schools are offering parents the choice to pay for school fees upfront. Paying fees in advance may be one of the best ways to protect your finances from the risk of the rising cost of private education while securing your child’s future place in their school. It could negate the impact of Labour’s proposed VAT introduction should anti-forestalling rules not be imposed.”