History of Vat Claims for Care Homes
It has been well known that Care & Nursing Homes have never been allowed to register for VAT
In the early 1990?s a loophole was discovered in VAT legislation which allowed Homes to register and Claim Vat, This was Know as ?The Toothbrush Scheme? some Homes successfully recovered VAT before the Loophole was closed. |
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The Kingscrest Care Group Challenged the ruling in the European court and after some years the Court ruled in Kingcrest?s Favour
The possibility of substantial VAT savings exists because the Court case of Kingscrest Associates determined that the UK law did not exempt care that was provided in residential homes that were not registered for the provision of nursing care. Consequently, such residential homes can now choose to VAT register retrospectively, if they so wish. HM Customs changed the law with effect from 21.3.2002 so from then on; residential care did become exempt from VAT. This has given rise to the opportunity to reclaim VAT for residential homes from start of trading up to 21.3.2002.
Homes that wish to register can go back to 1.4.73, or whenever they started in business if that was at a later date. The VAT registration would be in the name of the entity that owns the business, either a Sole Trader, a Partnership, or a Limited Company and would cover all their business activities (if they own several homes that qualify to be treated as VAT registrable, then the one VAT registration would cover them all). Homes that have been sold either pre or post 21.3.2002 can also be registered and the VAT reclaimed.
Homes can reclaim the VAT incurred on their normal running costs, and any capital expenditure, including building work. Homes which provided both residential care and nursing care could also benefit from these registration procedures, although the full recovery of VAT on the expenditure of the business will not always be possible, as some restriction will need to be made to take account of the exemption applicable to nursing care.
Any home that does register retrospectively will be automatically de-registered with effect from 21.3.2002, so the VAT registration will not have a continuing effect.
Unfortunately Nursing Homes don?t fall under this ruling- but combined Homes May be able to Claim as long as there nursing beds don?t take up more than 50% occupancy (for Clarification- please contact us) |
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We Work on a NO WIN= No Fee Basis,
so you have nothing to lose,
Please Take advantage of this before HM Customs find a way of stopping these claims, Contact Us today on 01663 742568 or Fax: 01663 744441 |
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