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VAT zero rating for drugs prescribed by doctors from EEA

17 March 2020: from April 1 2020 until the end of the transition period, drugs prescribed by ‘appropriate practitioners’ from the European Economic Area (EEA) and Switzerland will be zero rated for VAT, confirms HMRC.

Currently prescriptions from health professionals from the EEA and Switzerland do not fall within the zero rate when dispensed by UK pharmacies.

In Revenue and Customs Brief 2 (2020), HMRC announced a change to UK VAT law to align it with The Human Medicines Regulations 2012 which allows prescriptions written by EEA health professionals to be dispensed by UK pharmacies.

An appropriate practitioner is defined in the VAT Act 1994 by reference to a list, which from 1 April 2020 will be extended to include suitably qualified EEA health professionals. These changes will apply for the transition period, which is due to end on 31 December 2020.

At the end of the transition period the Human Medicines Regulations 2012 will be amended to introduce a list of ‘approved countries’ and only those who are suitably qualified to prescribe from these countries will be able to continue to do so in the UK. This list will be curated by the Department of Health & Social Care.

More information for these amendments and the list of recognised qualifications for approved countries will be published on gov.uk soon.