US military families stationed in the UK are exempt from VAT on school fees, while British military families who rely on private education have to pay up, Which School Advisor has reported.

The arrangement results from an agreement under the NATO Status of Forces Agreement of 1951.

UK service families are granted the Continuity of Education Allowance (CEA) but still face additional costs. The CEA, which covers up to 90% of fees for eligible children, was raised this month to offset the increase.

For secondary boarding schools, the maximum subsidy rose to £30,633 a year, a 12.5% increase from the previous cap of £27,240. However, military families still have to pay a minimum of 10% of fees and cover any additional costs exceeding the subsidy.

The Army Families Federation has called the imposition of VAT on service personnel as an “unfair burden on those who serve our country.”

The shadow defence secretary James Cartlidge said the government was treating British service personnel as “second-class citizens” and called on the government to rethink the issue.