V16.851 Opticians—apportionment of charges for supplies of spectacles and dispensing
VAT Information Sheet 8/99, 22 June 1999
This Information Sheet consolidates guidance on how to apportion the charges that you make for supplies of spectacles and dispensing previously contained in VAT Information Sheets 3/97, 10/98 and the amendment to Information Sheet 10/98. Those Information Sheets and the amendment are cancelled with effect from the date of issue of this Information Sheet. It also includes some of the guidance on apportionment contained in Business Briefs 2/99 and 4/99 (BB/2/99, BB/4B/99; Division V16.3). These Business Briefs are not cancelled.
Since the ruling of the High Court in the case of Leightons/Eye Tech in 1995 [C & E Comrs v Leightons Ltd; C & E Comrs v Eye-Tech Opticians (No 1) and Eye-Tech Opticians (No 2)  STC 458, see Part V10], it has been accepted by Customs and Excise that the supply of spectacles by an optician is a mixture of VAT-exempt dispensing services and standard-rated frames and lenses. When that ruling was made, Customs agreed several methods by which opticians could calculate refunds of VAT overpaid. Although those methods were intended primarily to calculate historical refund claims, they continued to be used for calculating VAT on current returns.
Customs reviewed the situation in 1997 and concluded that it was no longer appropriate for opticians to have centrally-agreed methods to establish their liability to VAT. The application of a limited set of methods to a varied group of traders had led to inaccuracies in