VATHLT1030 | Introduction: Background

The term ‘healthcare’ covers a broad range of goods and services, not all of which fall under the exemption from VAT.

Historically, the UK has taken the view that all services of persons who are registered or enrolled on statutory registers and which utilise the registered person’s professional training, knowledge and experience are exempt from VAT. However, following challenges to this approach, the exemption for services provided by registered health professionals was clarified and redefined, and in 1996, Customs (now HMRC) accepted that services which were predominantly legal in nature, such as arbitration, mediation, and conciliation, were liable to VAT at the standard rate. Later, in 2001, paternity testing also became subject to VAT at the standard rate following an ECJ ruling against Austria.