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Doctor, doctor

There is no VAT on healthcare - that's a long-standing EU rule. But it's not clear where it stops. If a doctor cures your ills, that's clearly healthcare - but what if a doctor examines you to see if you qualify for disability payments? Or to see if you can sue the last doctor who treated you negligently? The European Court has recently given a judgment that these types of medical work are unlikely to be VAT-exempt. "Healthcare" is supposed to be aimed at improving or protecting the health of the patient, and examinations carried out for some other purpose are basically VATable.

Customs are trying to assess the extent of the change that will be required. Up to now, they have regarded most "doctoring" - medical procedures - as within the exemption. Now you have to ask why the doctor is putting on the white coat. Customs are discussing the issue with the British Medical Association, and hope to give detailed guidance for doctors soon.

In the meantime, it won't make a difference to most doctors or medical practices which are not already registered for VAT. You only have to register if your VATable sales exceed £56,000 - changing these examinations from exempt to VATable is not likely to put many people over the limit. But some doctors are already registered, and they will have to take account of the change of view. Customs are unlikely to want to backdate any changes, because Customs themselves thought the supplies were exempt - but doctors who are registered for VAT need to watch out for announcements.