Recent Successes
Mixed Residential/Commercial Development by a Charitable Nursing Home
A residential care home which was also a charity asked us to look at the VAT implications of a property development project. The home was not previously registered for VAT and they were entering into arrangements to construct and subsequently sell ten new dwellings within their existing grounds. At the same time, they were building a new café as an extension to the existing home which would be used to sell catering services to residents and visitors for an additional charge.
We helped the home and their other project advisers to understand the technical VAT issues surrounding zero-rating relief, blocked input tax, accounting for output tax and input tax recovery in a simple and logical way. We registered them for VAT and secured backdated VAT refunds in excess of £75,000 as well as mitigating further potential VAT costs going forward.
Drugs dispensing by an NHS trust
An NHS Trust provided certain types of healthcare services to NHS and private fee paying patients. In the past the Trust and its previous VAT advisers had assumed that these services were either statutory healthcare, therefore outside the scope of VAT or VAT exempt, resulting in non-recoverable VAT costs.
We carried out a review of the service and secured a backdated VAT refund for the Trust in excess of £215,000. Since then, the Trust have put in place systems which will save them over £80,000 of VAT costs annually going forward.
- Relevant residential building or hospital?
- Development of new catering function
- PFI/PPP scheme
- Walk-in health centre
- Transfers to housing association
Relevant residential building
We have gained agreement from HMRC on behalf of an NHS Trust to treat a new building for patients as a 'relevant residential' building rather than a 'hospital building', therefore zero-rated, resulting in a VAT saving in excess of £270,000. This was following a detailed review of the relevant legislation and case law, the specific patient groups and care activities, staffing arrangements and details of the NHS 'continuing care criteria' for elderly/mental health patients and negotiations with Customs' policy unit.
IT infrastructure
We have recently reviewed an IT infrastructure contract for a client and gained agreement with HMRC for a VAT refund in excess of £1.6m.
Mixed use capital development
We have recently reviewed a major mixed use capital development for an NHS Trust relating to a new treatment centre and catering/restaurant facility, resulting in a VAT refund in excess of £450,000.