The Value Added Tax (Drugs and Medicines) Order 2023
A new VAT policy has come into being on 9th October 2023, which will mean more of a pharmacist’s sales are zero rated and will therefore increase the proportion they claim back on costs.
Currently, drugs and medicines dispensed for personal use (under prescription by an HCP) are zero rated. However, until now, VAT was chargeable on the same products dispensed under a Patient Group Direction.
This will now change to integrate the way such products are treated, helping to cut costs for the NHS, ease pressure on GPs and bring the tax system into line with changes to healthcare delivery.
The measure will remain in place until 31 March 2027, when its impact will be reviewed, but with its intention being “wholly relieving in nature” HMRC expects its effect to be positive.
If you have any questions on how and where to apply this new directive, please get in touch with your Xeinadin partner.