Revenue has been trying its best to implement as many measures as possible in order to help the people of Ireland tide over the Covid-19 crisis smoothly. With important measures being put in place to help the economy, a hallmark move was the introduction of concessions in VAT for specific medical products, goods, meals and grants. The latest update with regards to this stands that these concessions will be extended until 31st October 2020. Upon review of the situation then, this could potentially be extended further.
When this crisis first started, Revenue had decided to permit zero VAT tax for PPE kits and other medical equipment like thermometers, hand sanitisers, medical ventilators, respirators, oxygen tents, oxygen when sold to the HSE, hospitals, nursing and care homes, GP practices and other places used for treating Covid-19 patients.
These zero taxes now continue and is only applicable to those institutions selling to hospitals, nursing and care homes, GP practices and other places specifically used for treating Covid-19 patients. Standard rates continue to apply if medical aid is sold to any other firm, even if it is used to resell to any other institution where treatment is given to people affected by Covid-19.
Further to the usual records to be kept, sellers of such equipment have to check for themselves that their client can receive goods at zero rate of VAT tax. Mostly, this will be quite clear when it is sold to a hospital or nursing home but the seller has to check and confirm that the client is directly associated in giving treatment to Covid-19 patients and that the materials are consumed by the client for this purpose.
The materials being sold at zero rate VAT need to be particularly pointed out and reported in the bills.
Suppliers can carry on to subtract VAT on the inward costs for their operations as is done usually. These zero rates are already in force for some medical items through the usual VAT rules and will not be changed by these short-term VAT.
The supply of temporary emergency accommodation is exempt from VAT in accordance with paragraphs 11 of Schedules 1 and 3 to the VAT Consolidation Act 2010 and Regulation 46(c) of the VAT Regulations 2010. The exemption applies to the supply of emergency accommodation to the State/HSE/State Agencies for the purposes of being used as emergency accommodation as necessary to combat COVID-19.
Contributions or gifts of equipment and food
When a firm gives materials, which are less than £20, free of cost no VAT applies. If more than £20 worth of goods are given free of cost, to the HSE, hospitals, nursing homes and other treatment facilities for treatment related to Covid-19 patients, these materials will be seen as self-supplies and have zero VAT Tax.
When a firm contributes hot cooked food, food products including cold ready-made meals and non-alcoholic drinks free of cost to charity organizations and caregivers working for the Covid-19 crisis, for further supply to disadvantaged groups or people employed directly in treatment of Covid-19 patients, then Revenue will specifically ignore these items for calculating the eligible tax benefits for these firms.