Tax breaks for PPE

4 May 2020

HM Revenue & Customs has announced a temporary zero rating on supplies of personal protective equipment (PPE) under new coronavirus measures, likely to affect businesses and individuals purchasing PPE for protection from infection.

The VAT changes have been introduced to reduce the burden of VAT on the price of purchasing PPE used for protection from coronavirus by front-line workers. VAT of 20% has been charged on supplies of PPE but these are now to be zero-rated.

The change will be made by a temporary zero rating introduced via a new Group 20 to Schedule 8 of the Value Added Tax Act 1994.

The zero-rate is a temporary measure and has effect for three months, from 1 May 2020 to 31 July 2020.

As most users of PPE are exempt from VAT and cannot reclaim VAT they incur, this will be a cost saving for them.

Therefore, it is hoped the change will particularly aid sectors that cannot recover VAT on such goods due to their VAT exempt status, such as care homes, but will benefit all consumers.

Products covered by the zero rate will include:

  • disposable gloves

  • disposable plastic aprons

  • disposable fluid-resistant coveralls or gowns

  • surgical masks — including fluid-resistant type IIR surgical masks

  • filtering face piece respirators

  • eye and face protection — including single or reusable full face visors or goggles.