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VAT change for medicines prescribed by EEA doctors

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VAT change for medicines prescribed by EEA doctors

HM Revenue & Customs has amended its guidance on how to account for VAT on goods and services provided by registered health professionals by adding EEA health professionals to the list of practitioners who can prescribe zero-rated medicines.

Medicines prescribed by medical practitioners are zero-rated, but only if the prescriber is registered with the General Medical Council. Although it has for some time been lawful for prescriptions written by doctors registered in EEA countries to be dispensed in the UK, the medicines dispensed have not, until now, been zero-rated.

In the past this has led to large claims for VAT from some UK pharmacies, particularly those providing online services. In 2016, Pearl Chemist received a demand for £156,782.41. The company applied for a review of the decision which was concluded some 10 months later, and Pearl appealed against that decision in April 2017.

In a court case heard in 2019 the company was unsuccessful in challenging the lawfulness of restricting zero-rating only to supplies prescribed by doctors on the GMC register (Pearl Chemist v Revenue & Customs Commissioners [2019] UKFTT 264).

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