Care home operators are able to recover VAT incurred prior to 21 March 2002, following a court case in which a residential care home partnership, Kingscrest Associates Ltd & Montecello Ltd (t/a Kingscrest Residential Care Homes), successfully challenged HMRC’s interpretation of VAT law that prevented care home operators registering for VAT, to recover VAT on their expenditure.
By challenging the legal terms for ‘provision of care, medical and surgical treatment’ the residential home partnership, Kingscrest, succeeded at High Court in overturning the exemption that HM Revenue and Customs applied to the Care Home sector.
Kingscrest argued that they supplied residential accommodation with broad and personal care to persons in need, as opposed to directly supplying medical or surgical treatment, such as that supplied in a hospital or other approved institution, which includes convalescent homes and clinics.
The law was later changed to re-impose the exemption, but what Kingscrest achieved was to enable care home operators to backdate a VAT registration and account for VAT on their supplies to the Local Authority thereby allowing them to recover VAT on associated expenditure.
Consequently, if you, the care home operator, paid VAT on goods and services, such as building work, refurbishments and many other operating costs up to 21 March 2002, it is possible that you may be eligible for a refund, even if the business has subsequently been sold or ceased to operate.
VAT Solutions assesses the viability of your case, negotiates with the Local Authority and prepares all aspects of your claim. Our fee agreement is contingent upon successful completion, and our fee is only payable upon successful implementation and only after the Local Authority has made payment to you. If we are unable to progress a claim despite the work we undertake, there is no charge.
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