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HMRC internal manual

VAT Relief for Disabled People Manual

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HM Revenue & Customs
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Hydrotherapy pools

What is a hydrotherapy pool?
When is a hydrotherapy pool eligible for zero-rating?
Is the building housing the hydrotherapy pool eligible for zero-rating?

What is a hydrotherapy pool?

A hydrotherapy pool is usually smaller than a swimming pool. It is shallower than most swimming pools because it is designed for exercises to be undertaken rather than swimming and it is much warmer than a swimming pool. People using hydrotherapy pools often have a therapist in the water with them to assist them with the exercises. It can be used to relieve a variety of conditions. The liability of hydrotherapy pools has been the subject of litigation in VAT Tribunal cases.

Two of the cases related to eligible charities - David Lewis Centre (10860) and Boys and Girls Welfare Society (15274), which cared for disabled people and had installed at their premises a hydrotherapy pool.

The Tribunal also considered in the Robin Ellis Contracts Ltd, Mr & Mrs Dent (18500) case whether the supply of hydrotherapy pool with supporting plants and facilities for use by a disabled person is eligible for zero-rating.

In all of the above cases, the VAT Tribunal accepted that the installation of hydrotherapy pool qualified for zero-rating under the VAT Act 1994, Schedule 8, Group 12, item 2(g) (see VRDP05100).

However, it remains our general policy that swimming and other bathing pools are not equipment which has been designed solely for use by disabled people.

We now accept that a hydrotherapy pool incorporating certain features is designed solely for their use.

Boys and Girls Welfare Society Tribunal case

In this particular case, the pool had the following features:

  • sited indoors
  • a lip raised to wheelchair height to avoid people falling into the pool;
  • easy access to the water for disabled people;
  • railings at two different heights;
  • shallow rising steps which went up, over and down into the pool;
  • an invalid hoist in a fixed position so disabled people in wheelchairs could be lifted safely and easily in and out of the pool;
  • deep enough for disabled children to be helped to walk in it but not so deep that therapists were submerged to above shoulder height;
  • the pool floor sloped very gradually between shallow and deep ends;
  • special non slip floor tiles to provide better grip and prevent accidents;
  • the unit walls within which the pool was enclosed were clad with thermal acoustic wood to reduce the volume of sound. Sound reverberating off normally clad walls can cause muscle spasm for disabled people; and
  • the water and atmospheric temperature was maintained at between 32 and 35 degrees centigrade with a relative level of humidity of 60 per cent.

There was also:

  • a combination of chemical water treatment;
  • a turn round of water to take account of difficulties of incontinence that might be experienced by users of the pool; and
  • an environmental control system to provide the right water and air temperature and water quality.

See VRDP07400 for further information about environmental control systems.

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When is a hydrotherapy pool eligible for zero-rating?

A hydrotherapy pool, which is being supplied to an eligible charity or disabled people for their personal use, can be zero-rated where the pool incorporates the above features.

If the pool does not have any of the above features, then you should refuse to accept that the pool is equipment which has been designed solely for the use of a disabled person.

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Is the building housing the hydrotherapy pool eligible for zero-rating?

In Boys and Girls Welfare Society, the Tribunal found that the pool and the building to house it was a mixed supply of goods and services and denied relief for the construction of the building housing the pool.

However in the Robin Ellis Contracts Ltd, Mr & Mrs Dent case, the Tribunal found that the pool and its associated plant is a single supply of goods and services.

The Tribunal Chairman stated that:

“The facilities in this case were notably utilitarian and of a design suitable for the disabled. They did not serve as a recreational area within the pool enclosure. If we have regard to the Court of Justice’s guidance in the Card Protection case, the principal supply was that of the pool and these facilities were ancillary in the sense of not constituting for the customer “an aim in itself, but a means of better enjoying the principal service supplied.” In short, the pool, its enclosure and the facilities encompassed within it comprised a single economic supply of equipment within Group 12 Item 2(g) and to attempt to split out its different elements would be artificial and distortive of the true character of the supply.”

You need to consider if you should allow zero-rating on the facts of each case. For more guidance on construction liability matters, please refer to VCONST.