An amendment to the Scottish Charities Bill targeting private schools and health clinics has been defeated in the Scottish Parliament.
The amendment, from Christine Grahame of the SNP, would have strengthened the Bill's wording to oblige all charities to have the "over-riding purpose" of public benefit.
The Bill already requires all independent schools in Scotland to prove they provide public benefit.
Despite the defeat, Grahame said she was confident that fee-paying schools will find it difficult to pass the public benefit test. They will have to demonstrate that the barriers to that benefit are not "unduly restrictive."
The reforms could see private schools lose £4m in rates relief.
A spokesman for SCVO said: "Our primary concern is that we end up with a Bill that gives a clear definition of what a charity actually is."