HMRC Signals VAT Reform: Care Home Crackdown and Major Capital Goods Scheme Threshold Hike

• HMRC is taking a more assertive approach to VAT, with two major changes in 2025.
• The first change targets VAT structuring in the care home sector, potentially challenging long-standing arrangements previously protected under EU law.
• Care providers using these structures may face increased costs and possible litigation as HMRC seeks to protect revenue.
• The second change raises the Capital Goods Scheme threshold for properties from £250,000 to £600,000 in April 2026, reducing administrative burden but potentially disadvantaging charities and partially exempt organisations.
• These moves may signal broader VAT reforms and a review of other long-standing thresholds.

Source: thevatteam.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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