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HMRC internal manual

VAT Relief for Disabled People Manual

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HM Revenue & Customs
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Adjustable beds [item 2(b)]: was the bed ‘designed for invalids’?

It is significant that the law here uses the words ‘designed for invalids’, not ‘for a disabled person’. ‘Invalid’ is linked to a medical condition, temporarily or permanently, resulting in illness. The criteria for the eligible design are therefore different. These issues were explored in Tribunal case Niagara Holdings Ltd (11400).

The appeal was against a decision of the Commissioners that the Adjustamatic bed produced by Niagara was not entitled to relief under item 2(b). Both sides accepted that the beds were supplied to disabled persons and were electrically or mechanically adjustable. The third condition - that the bed was ‘designed for invalids’ - was the point at issue.

The Tribunal considered:

  • ‘both the stated intention of the designer and the end product’;
  • the level of medical and other specialist consultation in the design process;
  • the bed’s unusually strong construction;
  • the cycloidal massage vibrator units;
  • the facility for a variable height mechanism; and
  • the fixing holes necessary to enable the attachment of the optional parts such as cot sides, and leg lift.

The Tribunal concluded that:

“This was not a normal bed; it was not a bed designed for normal sleep and rest; all its features pointed objectively towards the fact that it was a bed designed for a special purpose. The appearance of the basic bed was such as to fit easily into a domestic environment but that is just what is envisaged by Item 2 of Group 14 (now Item 2(b) of Group 12 Schedule 8, VAT Act 1994). In our view we do not need to consider the use of the bed or the persons to whom the bed is sold. The legislation only requires that the bed is “designed for invalids” and not “designed solely for invalids” or “solely for the use of invalids”.

The above decision was endorsed by the Chairman in the Tribunal case of Hulsta Furniture (UK) Limited (16289).

This is a competitive market place, divided between suppliers who are geared towards helping disabled people and those who are aiming at a wider market, such as those who suffer from back pain or circulation problems. The phrase ‘designed for invalids’ is an important means of confining the zero rate to highly specialised beds and avoiding the zero rate spreading into the main stream market, with all the distortions in competition that would bring.

The Tribunal decision tells us that for a bed to meet this test it must clearly stand out as being something specialised for the use of invalids and akin to beds commonly used in hospital wards. In addition to the features listed above, one might also expect it to have facilities for ‘cot’ sides and drips where necessary.

There are now a lot of adjustable beds on the market and most of them are not designed for invalids.