HMRC Targets Cosmetic Surgery Providers for Unpaid VAT Amid Industry Growth and Misunderstandings

• HMRC is targeting the cosmetic surgery industry for unpaid VAT, estimated at £9.5bn in 2023-24, a 17 percent increase from the previous year.
• Many providers believe their services are VAT-free due to medical purposes, but HMRC views aesthetic services as VAT liable.
• A London hair transplant provider was targeted by HMRC, leading to a tribunal decision requiring an agreement on owed VAT over 17 years.
• Bryn Reynolds from Pinsent Masons advises cosmetic surgery providers to review their VAT status, as many believed they were exempt.
• Six cases have gone to the First Tier Tribunal in the last two years, indicating potential widespread issues.
• The sector’s growth suggests a high return potential for HMRC.
• Business owners are advised to reassess past advice on VAT exemption as services and regulations evolve.
• HMRC distinguishes between medical VAT exemption for disease treatment and aesthetic procedures.

Source: brearleyandco.co.uk

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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