Making successful tax decisions in a healthcare setting requires an in-depth and up-to-date understanding of VAT regulations.
These regulations as they relate to private hospitals, dental groups and care homes are notoriously complex, particularly where partial exemption is concerned.
But The Proactive Consultancy Group is ideally placed to provide clarity to the finance departments of partly exempt organisations like hospitals so that they can be confident that they are meeting the conditions of tax legislation while benefiting from the VAT refunds to which they are entitled.
Our VAT advisers also have extensive experience of working with CICs, cosmetic clinics, and high-value organisations in the business of healthcare supply and procurement.
Clients in the healthcare sector commonly consult us on
- VAT exemption and partial exemption
- property-related VAT
- mixed supplies
Case Study: £11.5m VAT Refund Secured Following a Complex HMRC Review
Sector: Healthcare & Diagnostics
Issue: Historic VAT treatment of diagnostic and screening services
Technical areas: Healthcare exemption, partial exemption, Principal Purpose Test, RHP supervision, error correction and historic VAT reconstruction
HMRC engagement: 14 rounds of correspondence and representations
Outcome: Approximately £11 million VAT recovered
Case Study: £2 Million Potential VAT Liability Reduced by Approximately £1.5 Million
Sector: Healthcare & Diagnostics
Service: Online and in-clinic PCR testing
HMRC’s initial position: Online PCR testing standard-rated
Potential VAT exposure: Approximately £2 million
Our position: The complete online testing pathway constituted a single exempt diagnostic supply
HMRC’s final position: Online PCR testing accepted as VAT-exempt
Liability reduction: Approximately £1.5 million
Remaining exposure: Approximately £500,000
Case Study: £2.2m+ VAT Recovered for a UK Consumer Diagnostics Provider
Sector: Consumer Healthcare & Diagnostics
Service: Home blood-testing and diagnostic services
Technical areas: Medical exemption, healthcare professional involvement, partial exemption, unjust enrichment and VAT error correction
HMRC review: Detailed technical and evidential examination
Outcome: More than £2.2 million VAT recovered
Cast Study: £800,000+ VAT Liability Reduced to Approximately £28,000
Sector: Medical Aesthetics & Cosmetic Equipment
Issue: Historic VAT registration and treatment of equipment sales
Technical areas: Principal and agent relationships, taxable turnover, retrospective VAT registration, imports and software-related components
Original exposure: £800,000+
Final settlement: Approximately £28,000
Reduction: More than 95%
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