HMRC, the UK’s tax authority, has recently made updates to their VAT guidance in VAT Notice 701/57. These updates specifically focus on the zero-rating of prescription medicines that are supplied under patient group directions. The changes are set to take effect from 9th October 2023 and will remain in place until 31st March 2027. However, it has come to light that there are some inaccuracies in the guidance, particularly regarding the inclusion of pharmacy technicians as health professionals. Additionally, the changes also introduce an exemption for fees earned by General Practitioners (GPs) for forensic physician services, as long as the primary purpose is the health of victims or perpetrators of crime. While these changes are generally positive, it is important for HMRC to address the errors in their guidance.
The inclusion of pharmacy technicians as health professionals in the revised VAT guidance has raised concerns among industry experts. The current guidance states that only registered medical practitioners and nurses can be considered health professionals. However, pharmacy technicians play a critical role in the healthcare system, particularly in the dispensing and management of prescription medicines. This oversight by HMRC could have unintended consequences and may lead to confusion and potential disputes over the correct VAT treatment of medicines supplied by pharmacy technicians. It is essential for HMRC to rectify this error and provide clear guidance on the matter.
Another significant change in the updated VAT guidance is the introduction of an exemption for fees earned by GPs for forensic physician services. This exemption applies when the primary purpose of the services is the health of victims or perpetrators of crime. This move recognizes the important role that GPs play in providing medical care and support to individuals involved in criminal cases. By exempting these fees from VAT, GPs can continue to offer their expertise and contribute to the well-being of those affected by crime. This change is a positive step towards ensuring that victims and perpetrators receive the necessary healthcare without any additional financial burden.
Despite the positive aspects of the updated guidance, it is crucial for HMRC to address the errors that have been identified. The inclusion of pharmacy technicians as health professionals is a significant oversight that needs to be rectified promptly. Pharmacy technicians are highly trained and regulated professionals who play a vital role in the delivery of healthcare services. Their contribution to patient care should not be undermined by incorrect guidance. HMRC must revise their guidance to accurately reflect the role of pharmacy technicians and provide clarity on the VAT treatment of medicines supplied by them.
In conclusion, the recent updates to HMRC’s VAT guidance, specifically regarding the zero-rating of prescription medicines supplied under patient group directions, are a step in the right direction. The exemption for fees earned by GPs for forensic physician services is also a positive development. However, the errors in the guidance, particularly the exclusion of pharmacy technicians as health professionals, need to be addressed. It is essential for HMRC to revise their guidance to ensure accuracy and clarity for all stakeholders involved. By doing so, they can provide a solid framework for the VAT treatment of medicines and healthcare services, benefiting both the healthcare industry and the general public.
