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HMRC internal manual

VAT Relief for Disabled People Manual

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HM Revenue & Customs
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Lift installation [items 16 to 18]

Introduction and law
Item 16
Item 17
Goods supplied in connection with the installation of lifts

Introduction and law

Subject to the basic pre-conditions for zero-rating which must be satisfied (see VRDP05000) zero-rating for the installation of lifts and associated goods is available under items 16 to 18:

  1. The supply to a handicapped person of services necessarily performed in the installation of a lift for the purpose of facilitating his movement between floors within his private residence.

  2. The supply to a charity providing a permanent or temporary residence or day-centre for handicapped persons of services necessarily performed in the installation of a lift for the purpose of facilitating the movement of handicapped persons between floors within that building.

  3. The supply of goods in connection with a supply described in item 16 or 17.

Item 16

Item 16 allows zero-rating for the supply of the services necessarily performed during the installation of an ordinary lift in the private residence of a disabled person. It overlaps with the relief contained in item 2(d) (see VRDP05100) as it allows zero-rating to extend to lifts which are not specially designed for use by disabled people but will nevertheless help them to move between floors within their home.

The services of installing a lift can be zero-rated under item 16 provided that:

  • the supply is made to a disabled person; and
  • the services are carried out in the private residence of that person.

In VRDP04000, you will find guidance which will help you to decide whether these two tests have been met.

We would allow zero-rating for an external lift at a disabled person’s private residence where the only means of access to the disabled person’s accommodation on an upper floor is by an external staircase.

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Item 17

Item 17 allows zero-rating for the supply of services necessarily performed during the installation of an ordinary vertical lift in a building where an eligible charity provides permanent or temporary residence or a day centre for disabled persons.

Here, the tests which must be satisfied before a supply can be zero-rated are:

  • the supply must be to an eligible charity;
  • that charity must provide a permanent or temporary residence or day-centre for disabled people; and
  • the installation of the lift must facilitate the movement of disabled people within that building.

The zero-rating provision is therefore not a blanket relief for the supply of a lift to an eligible charity for use by disabled persons. It is subject to specific conditions, as set out above.

Day-centre

Where an eligible charity provides a day-centre, it must be a place where disabled people receive day care. If day care is not provided to disabled people at the centre then the installation of a lift will not be zero-rated under item 17.

These issues were investigated in the following Tribunal cases:

  • Union of Students of the University of Warwick (13821); and
  • Aspex Visual Arts Trust (16419).

Union of Students of the University of Warwick (13821)

The appellant claimed that the installation of a lift at the Students Union Building at the University of Warwick was eligible for zero-rating. Prior to the installation of the lift it was not possible for students unable to climb stairs to have access to the two top floors of the Students Union Building, on which were situated a number of facilities available to the remainder of the student body. The lift was therefore intended principally for the use of disabled students, incorporating buttons at a lower level suitable for use by those in wheelchairs and there was also a Braille indicator underneath the buttons to assist the visually disabled.

The Tribunal examined the criteria under item 17. It was satisfied that the lift was installed for the purpose of enabling physically disabled students to have access to the building and that it was used principally by disabled students. However, it could not accept that the Union was providing ‘a permanent or temporary residence or day-centre for disabled persons’. In dismissing the appeal the Tribunal chairman therefore concluded:

“While I accept that the lift was supplied to the Union which is a charity and the supply was made and intended to benefit handicapped persons, I cannot regard the Building which exists to provide facilities for students generally both to the able-bodied and the handicapped as properly described as a “day-centre” within the ordinary sense of the term in modern English.”

“In Item 17 what has to be provided by the charity is a day-centre for handicapped persons. What the Union provides is a centre to which all students may resort but it does not follow that merely because disabled students do in fact resort to it that the centre has been provided for (my italics) handicapped persons.”

Aspex Visual Arts Trust (16419)

In the case of Aspex Visual Arts Trust, the Tribunal endorsed our view that installing a lift in a former church building which had been converted for use as an art gallery could not be zero-rated because the charity did not provide day care to disabled people.

Installation of lifts in educational establishments

Whilst charitable educational institutions have a general duty of care, especially to disabled people, they do not normally provide care in a day-centre as required by Item 17. Therefore zero-rating is limited to the supply of lifts installed in residential accommodation, such as halls of residence. This position is confirmed by the tribunal in the case of Union of Students of the University of Warwick (13821).

Goods supplied in connection with the installation of lifts

If the services of installing a lift are properly eligible for zero-rating under item 16 or 17, item 18 allows goods supplied in connection with those services to also qualify for zero-rating. This item therefore extends zero-rating to the lift and operating equipment.