Pharmacists

By Tolley
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The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Pharmacists
  • Essential services
  • Advanced services
  • Enhanced services (locally commissioned services)
  • Other payments received by pharmacists
  • Retail chemist scheme
  • Retail pharmacies VAT concession

The main activity of a pharmacist is the dispensing of drugs upon a doctor’s prescription to a customer and this activity is zero-rated.

VATA 1994, Sch 9, Group 7, Item 3, Notes 2A, 3; VAT Notice 701/57 ; VATHLT2530, VATHLT6000

The supply of certain services by a person registered in the register of pharmacists maintained under Pharmacy Order 2010, SI 2010/231, Article 19 (subscription sensitive) or in the register of pharmaceutical chemists kept under the Pharmacy (Northern Ireland) Order 1976 is exempt from VAT.

The exemption only applies to professional services for which the pharmacist is registered to undertake, such as providing pregnancy testing and smoking cessation products. Certain payments received from the NHS may also be exempt from VAT.

Community pharmacies are obliged to provide certain essential services to their patients and they can also offer additional services. These are explained below. The various services offered have differing VAT treatments and are also outlined below.

Essential services

Essential services comprise dispensing and repeat dispensing, disposal of unwanted medicines, ‘signposting’, promotion of healthy lifestyles, support for self-care, and support for people with disabilities.

The table below provides an overview of the VAT treatment of these services:

ActivityVAT treatment
Dispensing and repeat dispensing by a registered pharmacist against a prescription issued by a doctor, registered nurse or dentist. See the Doctors and Dentists guidance notes for more information

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