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HMRC internal manual

VAT Relief for Disabled People Manual

Boats [item 2(i)]

Conditions to be met under item 2(i)

As with all other sub-items to item 2, the basic preconditions (as set out in VRDP05000) must be met before zero-rating can apply under item 2(h) (see VRDP05100). However, in addition, the boat must be ‘designed or substantially and permanently adapted for use by disabled people before the supply can be zero-rated.

How to decide whether the boat is ‘designed or substantially and permanently adapted for use by handicapped persons’

You must read the following two numbered items.

1. What are the special features for disabled people?

To be considered eligible for full relief the boat must have special features for disabled people incorporated into it, so as to distinguish it from ordinary boats used by the able-bodied such as:

  • special washroom/toilet facilities;
  • push down spring return taps;
  • kitchen adaptations;
  • low windows, galley units and handrails;
  • special beds for paraplegics;
  • non-slip floors;
  • clamps and supports;
  • embarking and disembarking adaptations; or
  • steering, controls etc adapted for disabled people.

Note: This is not an exhaustive list.

2. What special features would a boat need to provide for disabled passengers in the context in which it is intended to operate?

A boat would not necessarily have to contain all of the above features to qualify for zero-rating. For instance, a boat which just provided day trips would require only those which were needed in the context of its intended use. If those special features are present at the time the boat is initially supplied, then the whole boat is ‘designed solely’ and so can be zero-rated. If however, the boat contained no such features at the time of sale, or its special features were insufficient in the context of its intended use, then the initial supply of the boat would be standard-rated. Zero-rating would however, apply to any subsequent qualifying adaptations under item 3 or item 4 (see VRDP43000).