In Ltd v HMRC [2024] TC09030, the First Tier Tribunal (FTT) found that a private medical clinic offering cosmetic treatments was not providing medical care. Its supplies were not exempt from VAT.

  • Ltd (ADCL) commenced trading in 2008 as a private medical clinic providing a wide range of cosmetic services.
    • Treatments included botox, facial volumising fillers, dermal fillers, and laser treatments primarily used for the repair of sun or sunbed damage.
  • ADCL’s sole owner and director was Dr McKeown, a qualified doctor registered with the General Medical Council and the British College of Aesthetic Medicine.
  • Following a VAT enquiry, HMRC issued a decision notice in April 2020 that ADCL was required to Register for VAT from 1 June 2010, having made taxable supplies over the VAT threshold.
    • HMRC’s view was that ADCL’s supplies were purely cosmetic and did not constitute medical care, which would have been exempt from VAT.
    • Best judgment assessments were subsequently raised.
  • ADCL Appealed to the First Tier Tribunal (FTT).

Item 1, Group 7, of Schedule 9 of the VAT Act 1994 exempts the supply of services consisting of the Provision of medical care by certain registered medical practitioners. Medical care in this context means diagnosing, treating and, in so far as possible, curing diseases or health disorders.

The FTT found that the services provided by ADCL were not, in the round, medical care:

  • Establishing the facts in this case was far from straightforward.
    • No accurate picture of ADCL’s activities in any period was provided and there was no credible or coherent evidence to establish that ADCL was providing medical care.
  • While ‘health disorders’, within the meaning of medical care, can encompass psychological issues, ADCL failed to prove the nature and extent of any such issues for individual patients.
  • Patients chose ADCL’s services because they wished to improve their appearance. ADCL's website encapsulated that thinking and patient questionnaires showed it to be the case. 
    • Individuals worrying that they were looking older were not suffering from a health disorder.
    • Ageing is not generally viewed as a disease. Sun and nicotine damage are not part of the ageing process; these are self-inflicted damage.
    • While sun or nicotine-damaged skin may be a health disorder in cases such as melanoma, in general, they are not.
    • Although ADCL assisted patients in achieving their goals concerning their appearance in a kind and supportive manner, this was not medical care.
    • Patients wanted to feel better and look less tired or old; they hoped to achieve greater self-esteem. This did not amount to medical care.

The appeal was dismissed. 


As with many things in tax, evidence is critical.

With the burden of proof on the taxpayer, it is necessary to produce sufficient evidence, when called upon to do so, to support taking a particular view. ADCL was not able to produce adequate evidence to support its supplies being exempt from VAT within the medical care exemption.

Useful guides on this topic

Health and welfare: VAT
When does reduced rating, zero rating and VAT exemption apply to services relating to medical care, health and welfare? What are the rules? 

Assessments: Best judgement & time limits
What is a 'best judgement' assessment for VAT? When can HMRC raise one? What are your rights of appeal? How do you displace a best judgement assessment? What are the time limits for a VAT assessment?

Registering for VAT
When should a business register for and charge VAT? What are the VAT registration thresholds? What penalties might HMRC issue for late notification of registration? When do you need to file a VAT return?

External link Ltd v HMRC [2024] TC09030