Changes to contracted-out services (COS) VAT rules – Heading 25 – Hire of reprographic equipment including repair and maintenance

As part of the ongoing review of the COS VAT guidance, HM Revenue & Customs (HMRC) has advised us that the next batch of COS guidance will confirm that VAT incurred on the hire, lease or rental of multifunctional devices which serve as printers, photocopiers and faxes is eligible for recovery under COS Heading 25.  This is following consultation with HM Treasury on the definition of this heading.  This is welcome news as it is a further example of the COS guidance being updated to take account of developments in technology.

Historically, this heading was restricted to photocopiers only.  NHS bodies should ensure that any VAT incurred on such contracts during the 2014/15 financial year is recovered on a VAT return before the 31st July 2015.