Most dentists never think about VAT — and most of the time they're right not to. But cosmetic treatment, product sales and selling a practice all sit outside the exemption, and getting the line wrong is expensive. Here's where dental VAT actually bites.
Guide · Evergreen — kept current
The supply of dental care and treatment for a person's health, provided by a registered dentist or dental care professional, is exempt from VAT (Group 7, Schedule 9, VATA 1994). That's why a normal practice doesn't charge VAT on check-ups, fillings, crowns, extractions, hygiene visits or clinically-justified treatment — and why most practices aren't VAT-registered at all.
Exempt is not the same as zero-rated. On exempt income you don't charge VAT, but you also generally can't reclaim the VAT on your costs — equipment, materials, refurbishment. That's just a feature of being in an exempt sector, and for most practices it's the end of the VAT story.
The exemption is for health. Once a treatment is provided purely for cosmetic reasons with no therapeutic purpose, it can fall outside the exemption and become standard-rated at 20%. The obvious candidates:
You have to register for VAT once your taxable (standard- or zero-rated) turnover exceeds £90,000 in any rolling 12 months. Crucially, your exempt dental income does not count towards that threshold — so a practice can turn over well over £90k in total and still not need to register, provided the cosmetic/retail slice stays under the line. Grow that slice, though, and registration becomes compulsory (check the current threshold — it's reviewed periodically).
If you're registered and have both exempt and taxable income, you can only reclaim the input VAT that relates to your taxable activities, plus a proportion of general overheads. There's a de minimis limit below which you can reclaim exempt-related VAT too. It's fiddly, it's easy to over- or under-claim, and it's exactly the sort of thing worth getting a dental-literate accountant to run rather than guessing.
Selling a practice as a going concern is normally treated as a transfer of a going concern (TOGC) — outside the scope of VAT — provided the conditions are met (the buyer carries on the same kind of business, is or becomes VAT-registered where relevant, and so on). Get the TOGC treatment wrong and VAT can be charged where it needn't be, or missed where it should apply. On a practice sale it's a detail worth confirming in the heads of terms, not after completion. See our guide to selling a practice.
If you're a standard NHS/private mixed practice with no cosmetics or retail, you almost certainly don't need to think about VAT. If you're adding aesthetics, whitening or a product range — or you're heading towards a sale — that's the moment to get the position checked, before the taxable side quietly crosses the line. That review is part of a proper dental accounting service; talk to us and we'll tell you plainly where you stand.
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Not on ordinary dental care — clinical treatment provided for a patient's health is exempt from VAT, so most practices don't charge it and aren't registered. VAT only comes in for cosmetic-only work, retail product sales and similar taxable supplies.
Whitening done for a purely cosmetic reason, with no therapeutic purpose, can be standard-rated at 20%. Where it's part of clinically-justified treatment the position can differ — it turns on the purpose, so it's worth confirming for your specific offering.
When taxable (non-exempt) turnover — cosmetics, aesthetics, retail and other standard-rated supplies — exceeds £90,000 in any rolling 12-month period. Exempt dental income doesn't count towards that threshold. Check the current threshold as it's reviewed periodically.
Usually not — selling as a going concern is normally a transfer of a going concern (TOGC), which is outside the scope of VAT if the conditions are met. It's worth confirming the treatment in the heads of terms rather than assuming.
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