RCB/16/13 VAT—clarification of HMRC's policy on laboratory pathology services provided by state-regulated institutions
Revenue & Customs Brief, Issue 16. 5 July 2013
This brief provides clarification about Her Majesty's Revenue and Customs' (HMRC) policy on when laboratory pathology services are exempt from VAT.
Health professionals, hospitals, hospices, nursing homes, pathology laboratories and any other state regulated institutions providing medical care. A state regulated institution includes any provider (including companies operated for profit) which requires approval, licensing, registration or exemption in relation to those activities.
To be aware of HMRC's clarification of policy on supplies of laboratory pathology services.
As a result of the Carter report on the review of NHS outsourcing services (2006), which recommended the streamlining of NHS services, some NHS pathology services have been, or are being, outsourced to the private sector. HMRC consider that such services are exempt from VAT. Some suppliers of these services challenge that view. They think that such supplies are liable to VAT on the grounds that: