Services provided by clinic were standard rated

The director and shareholder of the taxpayer was registered as a doctor with the Greater Medical Council. The clinic provided services mainly related to aesthetic skincare and wellness treatment.

For the VAT quarter ended 31 December 2016 HMRC assessed output tax by issuing a ‘best judgment’ assessment (VATA 1994 s 73(1)) on the basis that the services were standard rated as cosmetic treatment. The taxpayer claimed the services qualified as exempt medical care carried out by a registered health professional by virtue of VATA 1994 Sch 9 Group 7 item 1.

The First-tier Tribunal noted that patients attended because they wanted to use the clinic’s services rather than because of a referral for a medical condition diagnosed by another doctor. In other words attendance was usually ‘client led’ perhaps because the patient had suffered a loss of confidence about or were self-conscious of their...