VQOTW: VAT Liability of Covid Testing Services

Since the start of the Coronavirus pandemic many of my clients have become involved in providing Covid test kits and Covid testing services. Some clients are selling self-administered test kits, some are providing PCR testing for travellers and other clients are supplying testing services by visiting business premises to test on-site employees. Can you please clarify the VAT treatment?

Your question comes at a very opportune time, as just last week HMRC issued Revenue and Customs Brief 11 (2021): VAT liability of coronavirus (COVID-19) testing services, which provides much anticipated clarification on this matter.


In the Brief HMRC confirm that “the service of COVID-19 testing is treated as medical care where it involves administration of the test to the patient and the provision of the results by a medical professional (including where such activity is supervised by a medical professional).

In line with the normal VAT rules that apply to such care, it can only be exempted where it is:

  • carried out and supplied by a relevant health professional within the meaning of items 1, 2, 2A or 3 of Group 7 of Schedule 9 of the VAT Act 1994. Health professionals are listed in paragraph 2.1 of VAT Notice 701/57
  • supplied by a non-registered person, but the services are wholly performed by a relevant health professional — the exemption does not apply where the health professional is a dental technician
  • carried out by a non-registered person acting under the supervision of a relevant health professional — the exemption does not apply where the health professional is a pharmacist, pharmacy technician or dental technician
  • supplied by a hospital or state regulated institution — in this case the exemption also covers the supply of any goods in connection with the supply — Check VAT Notice 701/31 for more information.”

On this basis, the service of providing the PCR testing will be exempt provides the persons actually analysing the test results is a registered health professional, or non-registered person supervised by a relevant health professional other than a pharmacist, pharmacy technician or dental technician.

The sales of the self-administered Covid test kits, such as the lateral flow kits which produce an immediate result, and where there is no involvement of a registered health professional, are standard rated supplies of goods.

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Senior VAT Consultant
0844 892 2470

Hilary has worked in VAT since 1997, including five years with HMRC as an Assurance and Enquiries Officer. She spent eight years as a VAT manager, initially with a mid-tier accountancy firm, followed by six years with PricewaterhouseCoopers.

She has both advisory and compliance experience, working with a wide variety of clients ranging from small owner-managed businesses, to not-for-profit organisations and large multinational corporations, on the full range of VAT technical matters.

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