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Purchased for use in Medical Research, Training Diagnosis or Treatment
Supplies of relevant goods purchased by an eligible body with charitable funds will be zero rated. (VAT Act 1994, Schedule 8, Group 15, item 5)
The repair and maintenance of relevant goods is also zero rated. (VAT Act 1994, Schedule 8, group 15, item 6).
Relevant goods
Medical, scientific, computer equipment and certain software, video equipment, sterilising, laboratory or refrigeration equipment when purchased or hired mainly for medical research, training, diagnosis or treatment.
Equipment means articles designed for a specific purpose. Consumables are not included, e.g. chemicals, powders, paper, medicines.
Parts or accessories for use in or with any of the above equipment will be zero rated. Parts are integral components without which the equipment is incomplete. Accessories are optional extras that are not necessary for the equipment to operate in its normal course, but are used to improve the operation of the equipment or enable the equipment to be used, or used to better effect, in particular circumstances.
Repair, maintenance or installation of any of the above equipment, and any goods supplied in connection with this repair, maintenance or installation will be zero rated.
Eligible uses of equipment
The use of the equipment must be mainly for a qualifying purpose. This is defined by HMRC as 'real, substantial and continuing.' Substantial may be taken to be at least 51% of the time.
A. Medical research means original research into disease or injury.
B. Medical training covers the training of doctors, nurses or surgeons (including dental surgeons) and other professionals involved in medical diagnosis or treatment. The overall programme of training should include the physical application by the students of theoretical knowledge. The teaching of subjects like biology, where the trainee has no practical involvement with patients, is not medical training for the purposes of this VAT relief.
C. Medical diagnosis or treatment is the diagnosis or treatment of a physical or mental illness or injury by a medical or paramedical practitioner.
Ineligible uses of equipment
Medical, scientific, computer, video, sterilising, laboratory or refrigeration equipment purchased for any other use is not eligible.
This includes equipment purchased or hired for:
- General biological studies
- Environmental research
- Research into food products
- General administration
- Domestic or leisure purposes
- Where the equipment is to be used partly for a qualifying use and partly for any other use, it can be zero rated only where its main use is one of those detailed in A. B or C above.
Examples
Requisition creation in MyFinance
When entering the requisition information in MyFinance select Intended Medical Use and a VAT Zero Rating Certificate will be generated. This certificate must be issued to the supplier before they supply the goods.
Manual purchase orders
If you are making a manual order and require a VAT Zero Rating Certificate please use the document below:
