The current position on VAT and specially adapted computer equipment for disabled people is very confused. The criteria described in the guidance issued by HM Customs and Excise are quite clear when describing the principles of when Zero Rate VAT can apply and to whom but the consequent interpretation of this by HMCE is not.
1) The person for whom the equipment is supplied has to be disabled.
AND
2) The equipment has to be specially adapted for the use of the disabled person.
AND
3) The purchaser has to be a disabled person or a charity buying it for the use of one or more disabled people.
As the manufacturer of specially adapted computer systems for disabled people we design each complete system for the use of the person (or persons) for whom it is supplied. The various components needed are assembled together in such a way as to meet the individual needs of the particular disabled person. Some of the components are, in themselves, clearly specially adapted and some are "standard" items which can be used by anyone but all, be they hardware or software, are fitted together by us, configured, adjusted and adapted to create a complete system of resources that enables the disabled person to do something they would be unable to do, or would find great difficulty doing, without the specially adapted system we have manufactured for them. Accordingly it is our view, which has been confirmed at previous VAT inspections, that suchspecially adapted and individually tailored systems and the services needed for their use and maintainence are entitled to be Zero Rated for VAT when purchased by qualifying disabled individuals or by charities for use by one or more disabled individuals.
Unfortunately this reasoning is not applied uniformly and many suppliers have been required to use a bizzare calculation which excludes some essential components, such as keyboards, mice and monitors but not "central processor units", from Zero Rate VAT. The resulting "composite rate" is based on an average of all the computer systems a particular supplier has invoiced in the previous three months. Consequently some charge 4% and some 6% and others rates between 0% and 17.5%! There seems to be no reasonable logic to a "concession" which means that for an identically priced computer system the eventual cost to the purchaser can vary according to the mixture of products sold by the supplier in the previous three months. This must surely be counter to EU competition law? (Not to mention common sense!!)
We are asking our local HMCE VAT Office to confirm that we should continue to charge Zero Rate VAT on qualifying complete computer systems including hardware, software, delivery, training and support.
From 1 October 2004 and until this matter is resolved we will be charging VAT at 17.5% or 0% according to the individual items' qualification for Zero Rate VAT. We will be indicating on each product page whether Zero Rate can be applied for qualifying purchasers.
If you would like some advice or information about disability and study at degree level or if you need a quotation for specialist equipment and services though the Disabled Students' Allowance, please contact us.
If you are a disabled individual and want to purchase specially adapted equipment or software from us you will need to fill in a short declaration form. You can download this form (VATind) by clicking here. We need to have this form and some evidence of your disability before we issue our invoice otherwise we will have to charge VAT at the full rate. A copy of a diagnostic report, a copy of a letter showing your entitlement to DLA or DSA, a Statement or some other "official" document is needed.
If you represent a Charity which provides equipment and services for one or more disabled people and want to purchase specially adapted equipment or software from us you will need to fill in a short declaration form. You can download this form (VATcha) by clicking here. We need to have this form before we issue our invoice otherwise we will have to charge VAT at the full rate.
Once we have received a VAT declaration form from you we will keep it on file so we should not need to ask you again. We will treat all your documents as confidential, they will only be used to help us to meet your needs. Please read our policy document about confidentiality.
