Doctors to charge VAT in light of EU judgment
Insurance companies seeking a medical report before deciding the level of premium a client must pay are facing a 21% VAT top-up fee. Employers who request a medical report to enable them decide on the recruitment of a potential employee will also be charged an extra 21%.
Ernst & Young’s head of indirect tax, Jim Somers said insurance companies faced with the hike in fees were likely to pass on the extra charge to the consumer.
He said the type of medical reports which would be hit by the new tax included reports on issues of liability and quantifying damages for those contemplating personal injury litigation, as well as reports commissioned by insurance companies to decide on the level of illness cover a client should get.
Although employers will face a charge for reports commissioned on the basis of recruitment, they will be exempt from paying VAT on reports commissioned to assess employees health and safety.
“Where the doctor is invited by the employer to assess the ergonomics of the workplace, such as the effect of VDUs on employees or sitting postures, where the health of the individual is the chief concern, that type of report will be exempt from VAT.”
Mr Somers said this type of report would be easily identifiable from a medical assessment of a potential employee for recruitment purposes because of the medical criteria involved.
“The judgments handed down are landmark cases for the medical profession and all medical practitioners in Ireland, as well as major employers and insurance companies, who will need to carefully consider the repercussions of the judgments in an Irish context,” said Mr Somers.
