VAT and specialist healthcare providers

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Our VAT expert Ruth Corkin has been watching a significant decision against HMRC for the pregnancy scanning services in the case of private clinic Window to the Womb. The decision highlights the challenges specialist healthcare providers have with regard VAT.

Window to the Womb is a private well-being, gender and 4D pregnancy scanning clinic. It provides gender and foetal heath scanning together with pictures of unborn children for expecting mums and dads.

HMRC did not considered Window to the Womb to be healthcare providers, meaning that it had to charge its customers VAT on the services it provides. Window to the Womb disagreed and took the case to Tribunal.

The case explains Ruth Corkin, Director of Indirect Tax, hinged on whether there was a provision of care by a registered healthcare professional. If so, it would be exempt from VAT. If not, Window to the Womb products would be considered general supplies with VAT charged at 20%.

HMRC has long argued that sonographers are not on the list of medical professionals so cannot provide care that is exempt. However, most sonographers are also registered radiographers and sonography is, by its definition, a form of radiography. Window to the Womb and other clinics are also regulated by the Care Quality Commission (CQC).

Ruth successfully argued in the past that pregnancy clinics are state regulated and do provide care, with the majority of pregnant women seeking scans for their own well-being and that of their unborn baby and not just for the images provided. It means that it does not have to charge VAT to its customers. The decision in the Window in The Womb case upholds that view.

The decision has significant implications for all pregnancy scanning clinics and highlights the challenges specialist healthcare service providers face with regards HMRC and VAT.

Patient transport providers, for example, face the difference between VAT being zero-rated and exempt, depending on whether HMRC believes them to be providing passenger or patient transport services.

Occupational health providers, such as those companies make available to their staff, are seen by HMRC as simply providing advice with VAT chargeable. Yet may occupational health specialists are qualified healthcare professionals who offer traditional medical procedures, for example, blood pressure tests. Services should therefore be exempt.

The provision of day care in nursing and rest homes is often outsourced to specialist providers, yet HMRC considered those providers separate and unrelated to healthcare for VAT. Day care providers and their customers quite naturally disagree, leading to often protracted discussions and tribunal cases.

VAT is complex at the best of times. It becomes even more so when there is the provision of specialist care. Specialist care providers should seek the support and advice from an accountant that has a deep understanding of the sector and issues at hand.

Do you need extra information?

Ruth Corkin - Prinicipal - VAT and Indirect Tax Advisory at Hillier Hopkins

Ruth has been involved with VAT for over 30 years. She started her VAT career as a Customs and Excise Officer in Essex and then moved into consultancy with a variety of well-known accountancy firms. She is well known in the VAT world and is the proud author of many articles and technical works.

Contact Ruth at or on +44 (0)1908 713860

Based at the following office - Milton Keynes, Watford and London