It’s not surprising that we are regularly asked about charging VAT when it comes to disability. The rules are complex and there are a lot of grey areas. We have a very professional team here at Central Business Services that will be able to discuss any VAT concerns you may have.
Relief from VAT is available for disabled customers buying items of equipment but, just because a person is disabled doesn’t automatically mean that no VAT needs to be charged. The basic rule is that the goods or works should be “designed solely” for use by a disabled person. This means that any standard piece of equipment will not qualify. Therefore, items which do not qualify include orthopaedic beds, reclining chairs and air conditioning. Most computer hardware does not qualify.
While a disabled person may undoubtedly benefit from using such items, they do not pass the test of being “designed solely”. The VAT exemption is intended for such things as specialist adjustable beds, hoists, emergency alarm call systems and low vision aids.
Most of these are sold by specialist retailers who understand the distinction. It is unusual for a general retailer to supply anything which would qualify for VAT exemption, so the issue should rarely occur – but we keep being asked.
VAT on building and construction work for a disabled person
This is a more common situation where a builder or other tradesman is asked to modify or add to a home. Grey areas and confusion abound over this. It is so complex that we advise that each case be checked before proceeding with, what could be, an incorrect assumption. There have been a large number of tribunal decisions, some of which have only added to the confusion. Do i have to register for VAT?
One example is that widening an existing doorway qualifies for zero VAT but the creation of a new opening or changing a window to a doorway does not qualify and is subject to standard VAT.
Constructing a ramp for wheelchair access qualifies for zero VAT but not if it involves constructing a vehicle driveway or lowering a threshold. So, putting in a ramp is fine, because it makes access easier, but lowering a door threshold, which probably serves the same purpose, is not.
Installing a lift solely for use by a disabled person qualifies for zero VAT – but you need to be able to demonstrate that it is only for use by a disabled person, which can sometimes be difficult.
We can only repeat what was said above. When faced with a situation where relief from VAT may be applicable, gather all of the information and check before proceeding. It can be very expensive if a VAT inspector later decides that VAT should have been charged, but you didn’t.
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