VAT on medical/care services?

VAT on medical/care services?

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We have a client who are an employment agency which supplies care companies with staff, both medical and care staff, who visit people in their homes to provide services.

My understanding of Schedule 9 Section 7 (Exemptions: Healthcare) is that our client should be charging VAT on the staff providing the care services, such as bed baths and wake up calls, where no medical service is provided, but is exempt from charging it on the qualified staff that provide medical services. 

However, customers of my client - including two large councils - are saying that both should be exempt and that they have never paid VAT on either before.

Am I interpreting the legislation incorrectly and has anyone else got a similar situation?

The VAT helpline has been engaged all day......

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By User deleted
06th Jul 2015 17:01

Your interpretation is line with HMRC's interpretation - supply of staff is standard-rated. Have a read of para 2.5 last dot VAT 701/57/14 here.

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By AJF499
06th Jul 2015 17:15

Thanks! Good to know someone else is reading it the same as me.

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