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VAT: Company supplied staff not medical services


Mainpay Ltd argued that its supplies of medical staff indirectly to the NHS, qualified for an exemption from VAT. The first tier tribunal (FTT) disagreed and the UT upheld the decision.

21st Jan 2022
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Mainpay Ltd (MP), an umbrella company, employed or treated as employed, various medical consultants and GP doctors. These individuals were supplied to an agency: Accident & Emergency Agency Ltd (AEA). AEA in turn supplied these doctors to various NHS hospital trusts.

MP believed its supplies to be within the VAT exemption at Article 132(1)(b) or 132(1)(c) of the Principal VAT Directive (PVD), on the basis that they were:

  • Hospital and medical care (or closely related activities) undertaken by bodies governed by public law, and/or
  • The provision of medical care in the medical profession.

HMRC disagreed and treated the supplies made between the 1 November 2010 and the 31 January 2014 as standard rated, on the basis MP was supplying staff, not medical services. MP appealed to the first tier tribunal (TC7690), which found in favour of HMRC.

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