Philip Munn

Written by: Philip Munn and Brad Ashton

Philip Munn


Import VAT and duty freeze on medical supplies and emergency export controls on PPE

HMRC made two announcements on the 3 April to support and protect our stocks of vital medical and protective equipment supplies.

Until 31 July 2020, specified bodies will be entitled to import VAT and import duty relief on protective equipment, medical supplies and equipment which will ultimately be made available to those involved in combating the coronavirus outbreak.

This applies to imports only, and goods arriving in the UK from EU member states will be unaffected by this relief. Only two groups are eligible to claim the relief: any state organisation or public body governed by public law, including local authorities, NHS bodies or NHS Clinical Commissioning Groups; or non-state bodies importing specified goods, but only if such bodies are specifically authorised following application to HMRC’s National Import Relief Unit.If your organisation is eligible to receive the relief, the goods in question must meet two separate criteria.

  1. The goods must be classified for customs duty purposes under specific commodity codes.
  2. The goods must be distributed, made available free of charge, donated or sold to the NHS to those ‘affected by, at risk from or involved in combating the coronavirus’.

The usual VAT rules apply to the onward sale goods in the UK to the NHS. This means that  qualifying goods will be imported free of import VAT and duty but subject to the standard rate of VAT when sold to the NHS. Under current guidelines, such VAT charged to the NHS will unfortunately be an irrecoverable cost for them.

HMRC also announced that until 26 April 2020 anyone that wishes to send PPE to a country outside a list of EU, EFTA and related countries now needs to apply for an export licence. This follows a European Commission regulation designed to ensure EU, EFTA and related territories have adequate supplies of personal protective equipment (PPE). 

Exporting affected goods without authorisation will be an offence under the Customs and Excise Management Act 1979. If you wish to apply for a licence, you must complete an application form and a notification form and send to HMRC has promised to respond within five working days.

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