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F. Naz
F. Naz, Chartered Accountant
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As an osteopath I believe my services are vat exempt. If I

Resolved Question:

As an osteopath I believe my services are vat exempt. If I register for VAT am I able to reclaim expenses for setting up my business? am I also able to reclaim ongoing costs such as vat on rent?
Submitted: 1 month ago.
Category: Business
Expert:  F. Naz replied 1 month ago.

Please read below as it will answer your first question

Exempt business

If you only sell or otherwise supply goods or services that are exempt from VAT then yours is an exempt business and:

  • you cannot register for VAT
  • you cannot recover any VAT you incur on your purchases or expenses

This is in contrast to where you sell or otherwise supply zero-rated goods or services. Here you can reclaim the VAT on any purchases that relate to those sales. If you sell mainly or only zero-rated items, you can apply for an exemption from VAT registration. If you are exempted from registration you will not be able to reclaim any VAT.

And as it is written above you cannot recover any VAT you incur on your purchases or expenses so for rent you wont be able to reclaim VAT because rent is also an expense.

Reference;- https://www.gov.uk/guidance/vat-exemption-and-partial-exemption

Expert:  F. Naz replied 1 month ago.

Here is any source to support the statement for second question

Is VAT charged on property rental payments?

Whether you are charged VAT on rental payments depends on the particular property. If the landlord has ‘opted to tax’ for VAT purposes, then the rental payments will be subject to VAT; otherwise, rental payments are exempt from VAT.

If your business is VAT-registered, your costs will not normally be any higher whether the landlord has opted to tax or not. You can reclaim any VAT you pay, in the same way as you do for other business purchases.

However, if your business is not VAT-registered, or if you make VAT-exempt supplies, any VAT charged on rental payments will increase your costs.

Reference :-

https://www.qualitysolicitors.com/business/business-premises/faq/is-vat-charged-on-property-rental-payments

F. Naz and other Business Specialists are ready to help you
Customer: replied 1 month ago.
Thanks, ***** ***** osteopath I believe it is exempt rather than zero rated is this correct?
As a practice we do offer services such as massage and hypnotherapy, so if we charged VAT on these, would this then allow us to claim vat on business costs?
Expert:  F. Naz replied 1 month ago.
Will let you know thanks.
Expert:  F. Naz replied 1 month ago.

Yes according to the detals below your service will be exempt service . Please read below

Medical services provided by registered health professionals

2.1 What does ‘health professional’ mean?

By ‘health professional’, we mean the following professionals when they are enrolled or registered on the appropriate statutory register:

  • medical practitioners
  • optometrists and dispensing opticians
  • professionals registered under the Health Professions Order 2001 - these professionals are, arts therapists, biomedical scientists, chiropodists/podiatrists, clinical scientists, dieticians, hearing aid dispensers, occupational therapists, operating department practitioners, orthoptists, paramedics, physiotherapists, practitioner psychologists, prosthetists and orthotists, radiographers, and speech and language therapists, but will also include any medical care professionals added to the Order at a future date
  • osteopaths
  • chiropractors
  • nurses, midwives and health visitors
  • dentists, dental hygienists, dental therapists, dental nurses, clinical dental technicians, dental technicians and orthodontic therapists
  • pharmacists

2.3 What are medical services and which services performed by health professionals are exempt from VAT?

If you are a health professional as detailed in paragraph 2.1, your services are exempt when both of the following conditions are met:

  1. The services are within the profession in which you are registered to practise.

  2. The primary purpose of the services is the protection, maintenance or restoration of the health of the person concerned.

For the purposes of VAT, medical services (including medical care and treatment) are restricted only to services which fulfil the second condition above. This includes the diagnosis of illnesses, the provision of analyses of scans or samples and helping a health professional, hospital or similar institution to make a diagnosis.

Reference :- https://www.gov.uk/government/publications/vat-notice-70157-health-professionals-and-pharmaceutical-products/vat-notice-70157-health-professionals-and-pharmaceutical-products

For other services such as massage and hypnotherapy you have to check whether these service are generating enough revenue to fall in VAT bracket. which is called taxable turnover. please tell me the revenue amount, thanks.

Expert:  F. Naz replied 30 days ago.

Hello

Please let me know that did you read the information and was it helpful?