VAT and cosmetic dental treatments and augmentations

The supply of services relating to health are exempt if they are provided by a health professional and the primary purpose of the services is the protection, maintenance or restoration of the  health of the person concerned.  This includes the services of registered dentists and dental care professionals.

For most services and procedures relating to dentistry it is usually quite straight forward to determine whether the exemption is applicable.  However, for augmentation procedures it isn’t so easy to determine whether the “protection, maintenance or restoration of health” is the primary purpose.  Over recent years the numbers of people receiving such procedures has increased dramatically and are no longer just the domain of the rich and famous.  It could be argued that all procedures are undertaken in part to prolong the health of the teeth and mouth as well as to improve appearance.

The issue of whether a procedure is purely cosmetic or health related is contentious and open to interpretation.  When is a procedure undertaken purely for aesthetic reasons and VAT be charged?

This problematic issue was finally heard in the European Court of Justice in the recent PFC Clinic AB case.  Unfortunately, things aren’t that much clearer following the release of the judgment, it was stated that:

“the fact that services such as those at issue in the main proceedings are supplied or undertaken by a licensed member of the medical profession or that the purpose of such services is determined by such a professional may influence the assessment of whether interventions such as those at issue in the main proceedings fall within the concept of ‘medical care’ or ‘the provision of medical care’

In other words if a health professional has undertaken a procedure it is an indicator that the procedure is exempt, however it is still a requirement that the services are intended to diagnose, treat or cure diseases or health disorders or to protect, maintain or restore human health.

So, what has changed?  In short, not much really, all dental work is deemed to be medical care, but are not exempt unless it can be demonstrated that the intention is to maintain or restore health.  Therefore, the health professional needs to determine whether they consider that the requirements for exemption have been met.  Considering the multitude of treatments and procedures and the individual’s needs and motives, this is far from an ideal situation.  In addition, HMRC will not be in a position to see case notes, so they won’t be able to argue that there isn’t a health requirement!

For further information please contact the VAT specialist team on 01772 821021.