What is changing?
The Government has announced that, as an urgent response to the coronavirus emergency, a new temporary zero rate will apply to supplies of PPE, as defined by Public Health England’s coronavirus PPE guidance on 24 April 2020. The measure initially took effect from 1 May and was planned to end on 31 July 2020; this has subsequently been extended to cover supplies made until 31 October 2020.
Who will be affected?
VAT-registered businesses that supply PPE for protection from infection, and businesses and individuals that purchase such equipment.
When does it take effect?
The measure will affect supplies of PPE (as defined) between 1 May 2020 and 31 July 2020.
Are there any exceptions?
The items of PPE referred to in the Public Health England guidance are as follows:
- Disposable gloves
- Disposable plastic aprons
- Disposable fluid resistant overall/gown
- Surgical mask
- Fluid resistant (type IIR) surgical mask
- Filtering face piece respirator
- Eye/face protection
Anything falling outside the above categories will not fall within the scope of the zero-rating.
Actions required
Suppliers should apply the revised liability, as appropriate, to supplies with a tax point of 1 May 2020 and subsequently. If an actual tax point has been created prior to 1 May (e.g. by the issue of a tax invoice) but the basic tax point (delivery) does not occur until 1 May or later, then if the supplier wishes, VAT can be accounted for based on the basic tax point, and the zero-rate applied.
Further queries
Please direct any further queries to Julian Millinchamp.