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Agency Staff Costs… Are You Paying Too Much VAT?

Care providers employing agency staff may be paying unnecessary VAT charges…

One of the biggest challenges facing care operators post-Covid-19 is the understaffing of care services. With providers unable to employ and retain permanent staff consistently, agency staff are a key resource in keeping services functioning effectively.

VAT Solutions have been able to reduce such agency costs for some of our clients, as we have found that many care operators are not aware that through an HMRC extra-statutory concession, supplies of nurses, nursing auxiliaries and care assistants by state-regulated agencies (the nursing agencies’ concession) to a third party could be treated as VAT exempt. Nursing agencies (or employment businesses that provide nurses and midwives, as well as other health professionals) may exempt the supply of nursing staff and nursing auxiliaries supplied to a third party if the supply is of:

  • A registered qualified nurse or midwife (under article 5 of the Nursing and Midwifery Order 2001) providing medical care to a final patient.
  • An unregistered nursing auxiliary who is ‘directly supervised’ by one of the above.

Is your care provision employing agency staff in either of the above capacities? If you are being charged VAT on such supplies and think that the HMRC concession could be applicable, we would be happy to talk you through in more detail.

To speak to a care sector VAT specialist regarding the above, please contact Emma Harrison at VAT Solutionsemma@vatsol.com Tel: 0114 280 3630

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