VAT savings for people aged 60+ or with disabilities
You (or someone you care for) could lose out if you do not know about VAT ‘reliefs’ which give a discount on some purchases for those aged 60+ or who have disability. Read our brief guide below for an idea of what is available. We tell you how to find out more at the end.
VAT (‘Value Added Tax’) is charged at 20% on most goods and services. The supplier usually includes it in the price when you buy things.
Sometimes you automatically benefit where no VAT is charged on certain items – for example, basic foods. But VAT discounts can also be available on other goods and services if you can identify that you are entitled.
What does this page cover?
Here we aim to briefly summarise two types of VAT reduction:
1. ‘Zero rating’ for certain supplies to disabled people for their domestic or personal use – ie, no VAT is charged
2. ‘Reduced rating’ (currently 5%) on certain mobility aids installed in the homes of people aged 60+.
If you are aged 60+, you need to be aware of both because if you are also disabled you might get the full VAT discount where it is available rather than just the reduced rate.
1. Disabled people
Who is a ‘disabled person’ for VAT?
The VAT law term is ‘chronically sick or disabled’ - expanded in HMRC guidance as a person:
- with a physical or mental impairment that has a long-term and substantial adverse effect upon his/her ability to carry out everyday activities;
- with a condition that the medical profession treats as a chronic sickness, such as diabetes; or
- who is terminally ill.
What is covered by the ‘zero rate’?
In this section we give examples of items which can be free of VAT for disabled people (note that they can also apply if you are the carer of a disabled child catering for their needs):
VAT relief can be available if:
- you usually use a wheelchair for mobility and you hire, lease or purchase a car which has either been designed or substantially and permanently adapted so that you can get into it, travel as a passenger, or drive it. Note that the car has to be adapted when you purchase it - you cannot buy the car with VAT zero-rating and then have it adapted
- you pay for modifications to a car which enable you to use it - the cost of the modifications may be zero-rated
- you lease a car from the charity Motability or directly purchase a car previously hired under the scheme.
Alterations to your home
Some building works to adapt your home because of your disability can qualify, including:
- constructing ramps or widening doorways or passages
- extending or adapting a bathroom, washroom or lavatory
- installing a lift
- installing an alarm system so you can call for assistance.
Unfortunately some things which you might think should qualify do not, such as:
- constructing new doorways or passages
- alterations to house special medical equipment (the equipment itself might qualify for relief, but the alterations to your home do not)
- altering the layout of your home to accommodate a downstairs bedroom
- for kitchens, you can only get VAT relief on equipment designed specially to suit your disability, not on general alterations to layout etc.
A range of goods might be free of VAT if they are specially designed to help with a disability, for example certain:
- medical appliances
- adjustable beds
- commode chairs, stools and other similar devices to aid with bathing
- chair and stair lifts for invalid wheelchairs
- hoists and other lifting equipment
- low-vision aids (magnifying equipment, etc)
- Braille embossers
- long-handled pick-up sticks
- text telephones.
You might also be able to get VAT relief on:
- the cost of installing certain items (indeed, to get relief at all, some items from the list above have to be purchased and installed together rather than ‘do-it-yourself’)
- the cost of adapting general-purpose goods to suit your particular needs (but not the cost of the goods themselves)
- repair and maintenance costs of qualifying goods such as those listed above
- parts and accessories for designed solely to go with qualifying items (for example, a generator purchased to run a stair lift if there is a power cut does not qualify because it is a general-purpose item that could have other uses).
2. People aged 60+
Certain mobility aids can be installed in the home of someone aged 60+ at a reduced VAT rate of 5%. These are:
- grab rails
- stair lifts
- bath lifts
- built-in shower seats or showers containing built-in shower seats
- walk-in baths with sealable doors.
Note that the relief is only available where the items are supplied and installed together – you cannot purchase the items separately at the reduced rate and install them yourself.
But remember: if you are aged 60+ and are ‘disabled’ for the purposes of VAT, you might be able to claim to pay no VAT at all under the rules mentioned in (1) above.
How do you claim?
Suppliers must ensure that VAT is dealt with correctly so ask them if you think your purchase qualifies for the zero or reduced rate. Note that the whole purchase does not have to qualify – you can get partial relief. For example, if your house is being altered because of your disability part of the work might qualify for zero rating and part might not.
The supplier will ask you to make a declaration (often by signing a form or by electronic means if buying over the internet) that you are eligible, either as a disabled person or aged 60+. If you are unable to complete a declaration yourself, HMRC guidance confirms that a relative, partner or other responsible person can do so on your behalf.
Where can I find out more?
HMRC guidance for customers and contact details on VAT reliefs for disabled and older people.
HMRC’s VAT Notice 701/7 gives further information on the reliefs for disabled people.
HMRC also have a helpsheet for customers about purchasing zero-rated adapted vehicles.
The HMRC website explains how to contact them if you have particular needs, including Text Relay for those with hearing or speech impairment.
You can read more about the problems and inconsistencies in the VAT regime for disabled people in our January 2007 report (before the 60+ relief was introduced).
VAT and duty relief on goods imported which provide specified help to disabled people
There are reliefs on goods imported which provide specified help to disabled people and these are listed and described in the HMRC VAT Notice 701/7 mentioned above.