Aesthetics businesses beware! The botox treatments you think are exempt from VAT could in fact be
classed as purely cosmetic and land you in hot water with HMRC. And we’re not just talking botox.
As you probably know, you are exempt from charging VAT for treatments if there is a medical
purpose to those treatments and they have been administered by a medical professional. If the
treatment is purely cosmetic, VAT is chargeable.
But, you only need to be VAT registered if your taxable turnover is more than £85,000, and, if you
offer a mixture of cosmetic and medical services, the £85,000 threshold applies only to the cosmetic
side.
Confused? Don’t panic, CDC stays up-to-date with VAT regulations and how HMRC views those rules
in relation to the aesthetics industry. We, in turn, can help you understand when VAT should, and
should not be charged.
So book an appointment today to find out more, before you get an unpleasant surprise from HMRC.
Their Hidden Economy Team investigates aesthetics businesses and will look closely at non-payment
of VAT on certain services, and whether they were really exempt or not. If they rule that you should
have been charging VAT for procedures deemed cosmetic and not medical, you could face a fine and
further penalties.
So think about your business. Are you and/or your staff registered practitioners, and can the
treatments you do not charge VAT for really and truly be classed as medical? Do you have a record
of those treatments you believe to be exempt from VAT, with reasons why?
HMRC’s website has information on this, including their definition of a health professional.
They also define medical services, and which services performed by health professionals are exempt
from VAT.
The website states services are exempt when both of the following conditions are met:
1. The services are within the profession in which your registered to practice.
2. The primary purpose of the service is the protection, maintenance or restoration of the
health of the person concerned.
If you are reading this and you are still not sure whether you should charge VAT for certain services
or not, once again, do not panic. CDC is here to help, and all you have to do is pick up the phone and
book an appointment. What are you waiting for?