Weekly tax highlights ― 31 August 2021

Produced by Tolley

The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Weekly tax highlights ― 31 August 2021
  • Coronavirus (COVID-19)
  • Revenue and Customs Brief 11 (2021): VAT liability of coronavirus (COVID-19) testing services
  • Direct taxes
  • Termination awards and sporting testimonials: HMRC equality impact assessment
  • Company cars: advisory fuel rates from 1 September 2021
  • Pension schemes newsletter 132 ― August 2021
  • Indirect taxes
  • VAT notice 704 on Retail Export Scheme (Northern Ireland)
  • Revenue and Customs Brief 12 (2021): VAT treatment of gaming machines
  • More...

Weekly tax highlights ― 31 August 2021

Coronavirus (COVID-19)

Revenue and Customs Brief 11 (2021): VAT liability of coronavirus (COVID-19) testing services

HMRC has published a new VAT Brief which explains the rules for the VAT treatment of COVID-19 testing services.

The service of COVID-19 testing is treated as medical care where it involves administration of the test to the patient and the provision of the results by a medical professional.

In line with the normal VAT rules that apply to such care, the service of COVID-19 testing can only be exempted where it is:

  1. carried out and supplied by a relevant health professional within the meaning of items 1, 2, 2A or 3 of the VAT Act 1994, Sch 9, Group 7

  2. supplied by a non-registered person, but the services are wholly performed by a relevant health professional ― the exemption does not apply where the health professional is a dental technician

  3. carried out by a non-registered person acting under the supervision of a relevant health professional ― the exemption does not apply where the health professional is a pharmacist, pharmacy technician or dental technician

  4. supplied by a hospital or state regulated institution ― in this case, the exemption also covers the supply of any goods in connection with the supply

The supply of COVID-19 testing by a body regulated by the Care Quality Commission (CQC) (or equivalent in Northern Ireland, Scotland & Wales) for other activities, but not COVID-19 testing, remains standard-rated. The exemption can apply if the supply meets another of the tests required to qualify.

HMRC considers that the objective purposes of COVID-19 testing are diagnosis and the protection of human health. This also applies to tests taken for international air flights. Accordingly, such testing may be exempt medical care subject to meeting the usual requirements.

Direct taxes

Termination awards and sporting testimonials: HMRC equality impact assessment

HMRC has published an equality impact assessment of the changes to the NIC treatment of termination payments and sporting testimonials introduced in April

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